Question
In: Accounting
One might infer from a debit balance in Allowance for Doubtful Accounts that
One might infer from a debit balance in Allowance for Doubtful Accounts that
(a) a posting error has been made.
(b) more accounts have been written off than had been estimated would be uncollectible.
(c) the percentage of receivables basis is being used.
(d) bad debts expense has been overestimated.
Solutions
Expert Solution
(b) more accounts have been written off than had been estimated would be uncollectible.
Explanation - Allowance for doubtful accounts is a contra asset having credit balance. It is estimation of bad debt. If it has debit balance it means more accounts receivable have become uncollectible than what was originally estimated.
(b) more accounts have been written off than had been estimated would be uncollectible.
Nikita Chaplot answered 2 years agoRelated Solutions
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Select one:
True
False
2)When goods are shipped FOB destination, the revenue from the
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Select one:
True
False
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Fishy Fish company supplies flies and fishing gear to sporting
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business on December 31, 2015:
A
B
C
D
E
F
G
H
1
Not past Due
Days Past Due
2
3
Customer
Balance...
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the customer files for bankruptcy
the customer is making small but regular payments
the customer closes its business
the customer cannot be located
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