On December 31,prior to adjustment,Allowance for Doubtful Accounts has a debit balance of $800.An aging of the accounts receivable produces an estimate of $5,200 of probable losses from uncollectible accounts.The adjusting entry needed to record the estimated losses from uncollectible accounts is made for
A) $800.
B) $4,400.
C) $5,200.
D) $6,000.

Question

Quizplus · Accepted Answer

The Allowance for Doubtful Accounts needs to have a credit balance of $5,200 after adjustment. Since it currently has a debit balance of $800, the adjusting entry must be for $6,000 to offset the debit and achieve the desired credit balance.

On December 31,prior to Adjustment,Allowance for Doubtful Accounts Has a Debit