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NEED HELP ASAP An aging of a company\'s accounts receivable indicates that $4,00

ID: 2463557 • Letter: N

Question

NEED HELP ASAP

An aging of a company's accounts receivable indicates that $4,000 are estimated to be uncollectible. If Allowance for Doubtful Accounts has a $1,200 credit balance, the adjustment to record bad debts for the period will require a

credit to Allowance for Doubtful Accounts for $4,000.

debit to Bad Debts Expense for $4,000.

debit to Allowance for Doubtful Accounts for $2,800.

debit to Bad Debts Expense for $2,800.

credit to Allowance for Doubtful Accounts for $4,000.

debit to Bad Debts Expense for $4,000.

debit to Allowance for Doubtful Accounts for $2,800.

debit to Bad Debts Expense for $2,800.

Explanation / Answer

The adjustment to record bad debts for the period will require a debit to Bad Debts Expense for $ 2800.

i.e. $(4000-1200) = $ 2800

This amount will be debited as bad debts expense.