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