The value of Accounts Receivable is adjusted on the balance sheet by the contra-asset account
A)Allowance for Amortization.
B)Allowance for Doubtful Accounts.
C)Bad Debt Expense.
D)Doubtful Accounts Expense.

Question

Quizplus · Accepted Answer

The contra-asset account that adjusts the value of Accounts Receivable on the balance sheet is the Allowance for Doubtful Accounts. This account is used to record an estimate of potential bad debts or uncollectible accounts that may arise in the future. As a result, the net amount of Accounts Receivable presented on the balance sheet reflects the estimated amount of collectible receivables, after deducting the estimated amount of uncollectible receivables.

The Value of Accounts Receivable Is Adjusted on the Balance