The Allowance for Bad Debts Account Has a Credit Balance

question 111

Multiple Choice

The Allowance for Bad Debts account has a credit balance of $8,300 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 $14,700.What will be the balance of the Allowance for Bad Debts reported on the balance sheet?

• A)$14,700
• B)$6,400
• C)$23,000
• D)$13,230

---

Definitions:

Positive self-illusion

The tendency of individuals to view themselves more positively than may be objectively justified.

Medically abnormal

A condition or state that deviates from what is considered healthy or normal in medical practice.

Maladaptive

Refers to actions or behaviors that inhibit an individual's ability to adjust healthily to particular situations.

Deviant

Behaving or thought patterns that differ significantly from the norm or societal expectations, often carrying a negative connotation.