A Company Uses the Allowance Method and Expects Not to Collect

question 23

Multiple Choice

A company uses the allowance method and expects not to collect $21,000 of sales.The journal entry to record the estimated bad debt is:

• A)
• \[\begin{array} { | r | l | }
• \hline\text { Allowance for Doubtful Accounts } & \$ 21,000 \\
• \hline \text { Bad Debt Expense } & \$ 21,000 \\
• \hline
• \end{array}\]
• B)
• \[\begin{array} { | r | l l | }
• \hline\text { Allowance for Doubtful Accounts } & \$ 21,000 & \\
• \hline \text { Accounts Receivable } & \$ 21,000 \\
• \hline
• \end{array}\]
• C)
• \[\begin{array} { | c | l l | }
• \hline\text { Bad Debt Expense } & \$ 21,000 \\
• \hline \text { Allowance for Doubtful Accounts } & \$ 21,000 \\
• \hline
• \end{array}\]
• D)
• \[\begin{array} { | c | l l | }
• \hline\text { Accounts Receivable } & \$ 21,000 \\
• \hline \text { Allowance for Doubtful Accounts } & \$ 21,000 \\
• \hline
• \end{array}\]

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