Using the allowance method, the uncollectible accounts for the ye ar is estimated to be $ \$ 28,000 $. If the balance for the Allowance for Doubtful Accounts is a $ \$ 7,000 $ credit before adiustment, what is the amount of bad debts expense for the period?

Question

Quizplus · Accepted Answer

The bad debts expense is calculated by adjusting the Allowance for Doubtful Accounts to the estimated uncollectible amount. Since the allowance account already has a $ \$ 7,000 $ credit, the bad debts expense needed is $ \$ 28,000 - \$ 7,000 = \$ 21,000 $.

Using the Allowance Method, the Uncollectible Accounts for the Ye $28,000 \$ 28,000 $28,000

Using the Allowance Method, the Uncollectible Accounts for the Ye $\$ 28,000$