Using the aging-of-accounts-receivable method to estimate uncollectible receivables,Records Management Corp.estimates that $8,000 of its accounts receivable will be uncollectible.Prior to adjustment,the Allowance for Uncollectible Accounts has a debit balance of $2,000.Bad debt expense to be reported on the income statement is:

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The Allowance for Uncollectible Accounts needs to have a credit balance of $8,000. Since it currently has a debit balance of $2,000, an adjustment of $10,000 is needed to achieve the desired credit balance.

Using the Aging-Of-Accounts-Receivable Method to Estimate Uncollectible Receivables,Records Management Corp