The Allowance for Doubtful Accounts:
A)Is a contra asset account.
B)Is used instead of reducing accounts receivable directly.
C)Is debited when uncollectible accounts are written off.
D)All of the options are correct.
E)Is credited when bad debts expense is estimated and recorded.

Question

Quizplus · Accepted Answer

The Allowance for Doubtful Accounts is a contra asset account that is used instead of reducing accounts receivable directly. It is debited when uncollectible accounts are written off and is credited when bad debts expense is estimated and recorded. Therefore, all of the options are correct.