At the end of the year, Dahir Incorporated's balance of Allowance for Uncollectible Accounts is $2,000 (debit) before adjustment. The company estimates future uncollectible accounts to be $10,000. What is the adjustment Dahir would record for Allowance for Uncollectible Accounts? (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)

Question

Nylah

Business

28 October, 09:08

At the end of the year, Dahir Incorporated's balance of Allowance for Uncollectible Accounts is $2,000 (debit) before adjustment. The company estimates future uncollectible accounts to be $10,000. What is the adjustment Dahir would record for Allowance for Uncollectible Accounts? (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)

+4

Answers (1)

Know the Answer?

Mary Jane · Answer 1

Bad Debt Expenses for the year:

= Total estimated uncollectible + Debit balance in Allowance for Doubtful accounts

= $10,000 + $2,000

= $12,000

Therefore,

The adjusted journal entry is as follows:

Bad Debt Expense A/c Dr. $12,000

To Allowance for Doubtful Accounts A/c $12,000

(Being the Journal entry passed to record the Allowance for doubtful accounts)