The Account Allowance for Doubtful Accounts Is Classified as A(n)

question 176

Multiple Choice

The account Allowance for Doubtful Accounts is classified as a(n)

• A) liability.
• B) contra account of Bad Debt Expense.
• C) expense.
• D) contra account to Accounts Receivable.

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Definitions:

Net Loss

The amount by which expenses exceed revenues.

Net Income

The amount of money remaining after all operating expenses, taxes, and dividends have been subtracted from total revenue.

Fair Value

An estimate of the price at which an asset or liability could be exchanged between knowledgeable, willing parties in an arm's length transaction.