The allowance for doubtful debts account had a balance of $4500 before bad debts of $1000 were written off and the allowance was adjusted to 10% of the accounts receivable balance of $22 000. The new amount of allowance for doubtful debts that is deducted from accounts receivable in the balance sheet is:

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After writing off the bad debts of $1000, the allowance for doubtful debts needs to be adjusted to 10% of the accounts receivable balance of $22,000, which is $2,200. This is the new amount that will be deducted from accounts receivable in the balance sheet.

The Allowance for Doubtful Debts Account Had a Balance of $4500