Maradonna Co. uses an aging schedule of accounts receivable in estimating its bad debt expense. The total estimate, which appears on the aging schedule, will be equal to
A) the amount of bad debts expense on the company's income statement.
B) the debit balance required in the allowance account prior to the recognition of bad debts expense.
C) the increase in bad debts expense as a result of the estimate.
D) the credit balance required in the allowance account after the recognition of bad debts expense.

Question

Quizplus · Accepted Answer

The aging schedule estimates the required ending balance in the allowance for doubtful accounts, which is the credit balance needed after recognizing bad debts expense.