A business having a $400.00 debit balance in Allowance for Uncollectible Accounts and estimating its uncollectible accounts using accounts receivable aging to be $5,000.00 would record a $5,400.00 credit to Allowance for Uncollectible Accounts.

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The business needs to adjust the Allowance for Uncollectible Accounts to the newly estimated amount of $5,000.00. Since there is already a $400.00 debit balance, a $5,400.00 credit is required to both offset the existing debit balance and adjust the account to the new estimated balance.

A Business Having a $400