Asked by Haley Althaus on Jul 08, 2024
Verified
What is the type of account and normal balance of Allowance for Doubtful Accounts?
A) contra asset, credit
B) asset, debit
C) asset, credit
D) contra asset, debit
Allowance for Doubtful Accounts
A method used in accounting to estimate the portion of accounts receivable that may not be collected.
Contra Asset
An account that is used to reduce the value of a related asset, such as accumulated depreciation reducing the book value of fixed assets.
Normal Balance
The side (debit or credit) of an account that is expected to have a higher balance, indicating the side which increases the account.
- Learn the principles of the allowance method in accounting concerning uncollectible receivables.
Verified Answer
Learning Objectives
- Learn the principles of the allowance method in accounting concerning uncollectible receivables.
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