A company ages its accounts receivables to determine its end of period adjustment for bad debts. at the end of the current year, management estimated that $39,375 of the accounts receivable balance would be uncollectible. prior to any year-end adjustments, the allowance for doubtful accounts had a credit balance of $3,285. what adjusting entry should the company make at the end of the current year to record its estimated bad debts expense?

Question

Vaughan

Business

22 November, 08:51

A company ages its accounts receivables to determine its end of period adjustment for bad debts. at the end of the current year, management estimated that $39,375 of the accounts receivable balance would be uncollectible. prior to any year-end adjustments, the allowance for doubtful accounts had a credit balance of $3,285. what adjusting entry should the company make at the end of the current year to record its estimated bad debts expense?

+2

Answers (1)

Know the Answer?

Jazlene Melendez · Answer 1

Allowance for doubtful accounts

39,375-3,285=36,090

The journal entry

Debit: Bad Debt Expense

36,090

Credit: Allowance for Doubtful Accounts

36,090