The amount of uncollectible accounts at the end of the year is estimated to be $25,000,using the aging of accounts receivable method.The balance in the Allowance of Doubtful Accounts account is an $8,000 credit before adjustment.What should the account balance in the Allowance for Doubtful Accounts be after adjustment?
A)$8,000.
B)$17,000.
C)$25,000.
D)$33,000.

Question

Quizplus · Accepted Answer

The Allowance for Doubtful Accounts should reflect the estimated uncollectible amount, which is $25,000. Since there is already an $8,000 credit balance, an adjustment of $17,000 is needed to bring the balance to $25,000.

The Amount of Uncollectible Accounts at the End of the Year