A debit balance in Allowance for Doubtful Accounts Quizlet
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Tanning Company analyzes its receivables to estimate bad debt expense. The accounts receivable balance is $300,000 and credit sales are $1,000,000. An aging of accounts receivable shows that approximately 5% of the outstanding receivables will be uncollectible. What adjusting entry will Tanning Company make if the Allowance for Doubtful Accounts has a credit balance of $2,000 before adjustment? Show A)Bad Debt Expense 13,000 B)Bad Debt Expense 15,000 C)Bad Debt Expense 17,000 D)Bad Debt Expense 20,000 Paper Company receives a $6,000, 3-month, 6% promissory note from Dame Company in settlement of an open accounts receivable. What entry will Paper Company make upon receiving the note? A)Notes Receivable 6,000 Allowance for Doubtful Accounts has a credit balance of $800 at the end of the year (before adjustment), and an analysis of accounts in the customer ledger indicates the estimated amount of uncollectible accounts should be $16,000. Based on the estimate above, which of the following adjusting entries should be made? A)debit Bad Debt Expense, $800; credit Allowance for Doubtful Accounts, $800 Allowance for Doubtful Accounts has a debit balance of $1,100 at the end of the year (before adjustment), and an analysis of customers' accounts indicates uncollectible receivables of $12,900. Which of the following entries records the proper adjustment for Bad Debt Expense? A)debit Bad Debt Expense, $14,000; credit Allowance for Doubtful Accounts, $14,000 B)debit Allowance for Doubtful Accounts, $14,000; credit Bad Debt Expense, $14,000 C)debit Allowance for Doubtful Accounts, $11,800; credit Bad Debt Expense, $11,800 D)debit Bad Debt Expense, $11,800; credit Allowance for Doubtful Accounts, $11,800 Abbott Company uses the allowance method of accounting for uncollectible accounts. Abbott estimates that 3% of net credit sales will be uncollectible. On January 1, 2010, the Allowance for Doubtful Accounts had a credit balance of $2,400. During 2010, Abbott wrote-off accounts receivable totaling $1,800 and made credit sales of $100,000. There were no Sales Returns or Sales Discounts during the year. After the adjusting entry, the December 31, 2010, balance in the Bad Debt Expense would be $1,200 $3,000 $3,600 $7,200 Allowance for Doubtful Accounts has a debit balance of $800 at the end of the year (before adjustment), and an analysis of accounts in the customers ledger indicates uncollectible receivables of $15,000. Which of the following entries records the proper adjusting entry for bad debt expense? A)debit Bad Debt Expense, $800; credit Allowance for Doubtful Accounts, $800 B)debit Bad Debt Expense, $14,200; credit Allowance for Doubtful Accounts, $14,200 C)debit Allowance for Doubtful Accounts, $800; credit Bad Debt Expense, $800 D)debit Bad Debt Expense, $15,800; credit Allowance for Doubtful Accounts, $15,800 Allowance for Doubtful Accounts has a credit balance of $1,500 at the end of the year (before adjustment), and an analysis of customers' accounts indicates uncollectible receivables of $17,900. Which of the following entries records the proper adjustment for Bad Debt Expense? A)debit Allowance for Doubtful Accounts, $16,400; credit Bad Debt Expense, $16,400 B)debit Allowance for Doubtful Accounts, $19,400; credit Bad Debt Expense, $19,400 C)debit Bad Debt Expense $19,400; credit Allowance for Doubtful Accounts, $19,400 D)debit Bad Debt Expense, $16,400; credit Allowance for Doubtful Accounts, $16,400 Allowance for Doubtful Accounts has a credit balance of $1,400 at the end of the year (before adjustment). The company prepares an analysis of customers' accounts to estimate the amount of uncollectible accounts of $17,900. Which of the following adjusting entries would be made to record the Bad Debt Expense for the year? A)debit allowance for doubtful Accounts, $16,500; credit Bad Debt Expense, $16,500 B)debit Allowance for Doubtful Accounts $19,300; credit Bad Debt Expense, $19,300 C)debit Bad Debt Expense, $19,300; credit Allowance for Doubtful Accounts, $19,300 D)debit Bad Debt Expense, $16,500; credit allowance for Doubtful Accounts, $16,500 Allowance for Doubtful Accounts has a debit balance of $1,200 at the end of the year (before adjustment). The company prepares an analysis of customers' accounts and estimates the amount of uncollectible accounts to be $13,900. Which of the following adjusting entries is needed to record the Bad Debt Expense for the year? A)debit Bad Debt Expense, $15,100; credit Allowance for doubtful Accounts, $15,100 B)debit Allowance for Doubtful Accounts, $15,100; credit Bad Debt Expense, $15,100 C)debit Allowance for Doubtful Accounts, $12,700; credit Bad Debt Expense, $12,700 D)debit Bad Debt Expense, $12,700; credit Allowance for Doubtful Accounts, $12,700 What is a debit balance in allowance for doubtful accounts?The purpose of the allowance for doubtful accounts is to estimate how many customers out of the 100 will not pay the full amount they owe. Rather than waiting to see exactly how payments work out, the company will debit a bad debt expense and credit allowance for doubtful accounts.
What is the type of account and normal balance of allowance for doubtful accounts quizlet?What is the type of account and normal balance of Allowance for Doubtful Accounts? Indicates that actual bad debt write-offs have exceeded previous provisions for bad debts. Under the allowance method, when a year-end adjustment is made for estimated uncollectible accounts? Total Assets are unchanged.
Can allowance for uncollectible accounts have a debit balance?Because the allowance for doubtful accounts account is a contra asset account, the allowance for doubtful accounts normal balance is a credit balance. So for an allowance for doubtful accounts journal entry, credit entries increase the amount in this account and debits decrease the amount in this account.
What does the allowance for doubtful accounts represent quizlet?The allowance for doubtful accounts represents a company's estimate of the amount of uncollectible receivables. Companies do not know the exact amount of receivables that will be uncollectible, so they must estimate the amount. The percentage of revenue is one option for estimating uncollectible accounts.
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