On February 1,a customer's account balance of $2,300 was deemed to be uncollectible.What entry should be recorded on February 1 to record the write-off assuming the company uses the allowance method?
A)Debit Bad Debts Expense $2,300;credit Accounts Receivable $2,300.
B)Debit Allowance for Doubtful Accounts $2,300;credit Bad Debts Expense $2,300.
C)Debit Allowance for Doubtful Accounts $2,300;credit Accounts Receivable $2,300.
D)Debit Bad Debts Expense $2,300;credit Allowance for Doubtful Accounts $2,300.
E)Debit Accounts Receivable $250;credit Allowance for Doubtful Accounts $2,300.

Question

Quizplus · Accepted Answer

When using the allowance method, the write-off of an uncollectible account is recorded by debiting the Allowance for Doubtful Accounts and crediting Accounts Receivable for the same amount. Therefore, choice C is the correct answer. Choice A is incorrect because it debits Bad Debts Expense instead of Allowance for Doubtful Accounts. Choice B is incorrect because it debits the Allowance for Doubtful Accounts instead of crediting it. Choice D is incorrect because it debits Bad Debts Expense instead of crediting Allowance for Doubtful Accounts. Choice E is incorrect because it does not reflect the actual amount of the uncollectible account.

On February 1,a Customer's Account Balance of $2,300 Was Deemed