On December 31, prior to adjustment, Allowance for Doubtful Accounts has a credit balance of
$430. An analysis of the accounts receivable aging estimates $1,900 of probable losses from uncollectible accounts. The adjusting entry needed to record the estimated losses from uncollectible accounts is
A)$430.
B)$1,900.
C)$2,330.
D)$1,470.

Question

Quizplus · Accepted Answer

The adjusting entry should increase the Allowance for Doubtful Accounts to the new estimated total of $1,900. Since there is already a $430 credit balance, the adjustment needed is $1,900 - $430 = $1,470.

On December 31, Prior to Adjustment, Allowance for Doubtful Accounts