Question

The amount of uncollectible accounts at the end of the year is estimated to be $25,500, using the aging of accounts receivable method. The balance in the Allowance of Doubtful Accounts account is an $8,200 credit before adjustment. What is the adjusted balance of the Allowance for Doubtful Accounts at the end of the year?

Answer 1

Answer:

$25,500

Explanation:

The adjusted balance of the Allowance for Doubtful Accounts is $25,500 as the amount of uncollectible accounts which is estimated at the end of the year is considered to come in the adjusted balance.  

As it records only the estimated amount, no other amount would be recorded.

All other information which is given is not relevant. Hence, ignored it. So, only $25,500 would be considered, not $8,200. It would be shown on the asset side of the balance sheet under the account receivable account. This amount is deducted from the account receivable amount