The amount of uncollectible accounts at the end of the year is estimated to be $25,000, using the aging of accounts receivable method. The balance in the Allowance of Doubtful Accounts account is an $8,000 credit before adjustment. What is the adjusted balance of the Allowance for Doubtful Accounts at the end of the year? Multiple Choice a.$25,000 b. $33,000 c. $17,000 d. $8,000

Correct answer is C.

$17,000 is the adjusted balance

Explanation:

The amount of uncollectible accounts at the end of the year is estimated to be $25,000.

The balance in the Allowance of Doubtful Accounts account is an $8,000 credit before adjustment

Bad Debt Expense = uncollectible accounts at the end of the year - Existing credit balance in allowance for doubtful accounts or + existing debit balance in allowance for doubtful accounts

Bad debts expense for the period = 25,000 - 8,000

= $17,000

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