Allowance for Doubtful Accounts has a credit balance of $3,600 immediately before the write-off of a $750 account receivable. The balance of Allowance for Doubtful Accounts immediately after the write-off is
A)$750 debit.
B)$2,850 credit.
C)$4,350 credit.
D)$2,850 debit.

Question

Quizplus · Accepted Answer

The write-off of a $750 account receivable will reduce the balance of Allowance for Doubtful Accounts. The new balance will be the original balance of $3,600 minus the $750 write-off, resulting in a new balance of $2,850 credit. Therefore, the correct answer is B.

Allowance for Doubtful Accounts Has a Credit Balance of $3,600