Allowance for Doubtful Accounts Has a Debit Balance of $2,300

question 122

Multiple Choice

Allowance for Doubtful Accounts has a debit balance of $2,300 at the end of the year (before adjustment) . The company prepares an analysis of customers' accounts and estimates the amount of uncollectible accounts to be $31,900. Which of the following adjusting entries is needed to record the Bad Debt Expense for the year?

• A) debit Bad Debt Expense, $34,200; credit Allowance for Doubtful Accounts, $34,200
• B) debit Allowance for Doubtful Accounts, $34,200; credit Bad Debt Expense, $34,200
• C) debit Allowance for Doubtful Accounts, $29,600; credit Bad Debt Expense, $29,600
• D) debit Bad Debt Expense, $29,600; credit Allowance for Doubtful Accounts, $29,600

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Definitions:

Collectivist Cultures

Societies that emphasize the needs and goals of the group as a whole over the needs and desires of each individual.

External Attributions

External attributions are explanations for one's behavior or outcomes based on external circumstances or environmental factors, rather than personal characteristics.

Internal Attributions

The process of attributing behavior to internal characteristics of the agent, such as personality, attitude, or effort.

Fundamental Attribution Error

The tendency to overemphasize personal characteristics and ignore situational factors in explaining others' behavior.