Question

Allowance for Doubtful Accounts has a credit balance of $2,100 at the end of the year (before adjustment), and an analysis of customers' accounts indicates uncollectible receivables of $19,700. Which of the following entries records the proper adjustment for bad debt expense?

a. debit Bad Debt Expense, $21,800; credit Allowance for Doubtful Accounts, $21,800
b. debit Allowance dfor Doubtful Accounts, $17,600; credit Bad Debt Expense, $17,600
c. debit Allowance for Doubtful Accounts, $21,800; credit Debt Expense, $21,800
d. debit Bad Debt Expense, $17,600; crdit Allowance for Doubful Accounts, $17,600

Other receivables includes all of the followoing EXCEPT:

a. taes receivable
b. interest receivable
c. receivables from employees
d. notes receivabe

Answer 1

Answer:

1. Analysis of accounts receivables Allowance Required     $19,700

Less: Credit balance available in Allowance account           $2,100

Additional allowance required                                               $17,600

The journal entry will be as follows

                                                              DEBIT        CREDIT

Bad debt expenses                              $17,600

Allowance for doubtful accounts                            $17,600

Hence, the correct option is D.

2. Other receivables include all except "Notes Receivables"

Hence, the correct option is D