Question

Analysis of Receivables Method Example

Total estimated Allowance for Doubtful Accts = $25,500
Current balance in Allowance for Doubtful Accts = $1,000 Credit
What is the adjusted balance for Allowance for Doubtful accts?

Answer 1

The adjusted balance for Allowance for Doubtful Accounts is $24,500 (credit).

Step-by-step explanation:

To calculate the adjusted balance for the Allowance for Doubtful Accounts, you need to subtract the current balance from the total estimated allowance. In this case, the total estimated allowance is $25,500 and the current balance is $1,000 (credit). Subtracting the current balance from the total estimated allowance gives us an adjusted balance of $24,500 (credit).