The Allowance for Bad Debts Has a Credit Balance of $8,000

question 8

Multiple Choice

The Allowance for Bad Debts has a credit balance of $8,000 before the adjusting entry for bad debts expense. After analyzing the accounts in the accounts receivable subsidiary ledger using the aging-of- receivables method, the company's management estimates that uncollectible accounts will be $17,000. What will be the amount of Bad Debts Expense reported on the income statement?

• A) $25,000
• B) $9,000
• C) $17,000
• D) $8,000

---

Definitions:

Bystander Effect

The psychological phenomenon where individuals are less likely to offer help to a victim when other people are present.

Diffusion Of Responsibility

is a sociopsychological phenomenon whereby a person is less likely to take responsibility for action or inaction when others are present.

Therapeutic Community

A structured environment where individuals support one another in recovery or rehabilitation, using the community itself as a key agent of change.

Core Concept

A fundamental idea or principle that serves as the foundation for a system, theory, or belief.