Allowance for Doubtful Accounts has an unadjusted balance of $500 at the end of the year,and uncollectible accounts expense is estimated at 1% of net sales.If net sales are $950,000,the amount of the adjustment to record the provision for doubtful accounts is:
A)$9,500.
B)$500.
C)$8,500.
D)$9,000.

Question

Quizplus · Accepted Answer

The adjustment for doubtful accounts is calculated as 1% of net sales, which is $950,000 * 1% = $9,500. The unadjusted balance of $500 is not relevant to the calculation of the adjustment amount.

Allowance for Doubtful Accounts Has an Unadjusted Balance of $500