Allowance for Doubtful Accounts Has a Credit Balance of $800

question 160

Multiple Choice

Allowance for Doubtful Accounts has a credit balance of $800 at the end of the year (before adjustment) , and an analysis of accounts in the customer ledger indicates the estimated amount of uncollectible accounts should be $16,000. Based on this estimate, which of the following adjusting entries should be made?

• A) debit Bad Debt Expense, $800; credit Allowance for Doubtful Accounts, $800
• B) debit Bad Debt Expense, $15,200; credit Allowance for Doubtful Accounts, $15,200
• C) debit Allowance for Doubtful Accounts, $800; credit Bad Debt Expense, $800
• D) debit Bad Debt Expense, $16,800; credit Allowance for Doubtful Accounts, $16,800

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Definitions:

Naturally Occurring Hormone

A hormone that is produced and found naturally within an organism, without artificial enhancement or modification.

Non-prescription Medication

Non-prescription Medication refers to drugs and treatments that can be purchased without a doctor's prescription, often used for minor ailments or conditions.

Melatonin

A hormone produced by the pineal gland in the brain, involved in regulating the sleep-wake cycle.

Non-rapid Eye Movement Sleep

A type of sleep that includes stages 1-3, characterized by a gradual decrease in heart rate, breathing rate, and muscle activity.