Analysis of accounts receivable indicates that 5000 are esti

Analysis of accounts receivable indicates that $5,000 are estimated to be uncollectible. If Allowance for Doubtful Accounts has a $1,200 credit balance, the adjustment to record bad debt expense for the period will require a:

Solution

Estimated bad debts are $5,000 and allownace for doubtful account has an existing credit balance of $1,200, the adjusting entry includes a $3,800 debit to bad debts expense.