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The Allowance For Doubtful Accounts Is A Contra Asset Account That Equals To Total Uncollectible Accounts Reason: As we know that Allowance For Doubtful Accounts is a Contra Asset Account which is deducted from closing balance of Accounts Receivable on Balance Sheet in order to calculate the Net Realizable Value (NRV) of Accounts Receivable , so mathematically, we can say that: Net Realizable Value = Accounts Receivable - Allowance For Doubtful Accounts Net Realizable Value + Allowance For Doubtful Accounts = Accounts Receivable Allowance For Doubtful Accounts = Accounts Receivable - Net Realizable Value As Accounts Receivable - Net Realizable Value = Total Uncollectible Accounts So, we have the following result as shown below: Allowance For Doubtful Accounts = Total Uncollectible Accounts So, we can say that Allowance For Doubtful Accounts is equal to Accounts Receivable minus Net Realizable Value of Accounts Receivable which represent total estimated uncollecti...

Answer Of MCQs The Correct Answer of this multiple choice question is (E) as under Accrual Basis of Accounting , we record Revenue when it is earned by the company whether the cash is received or not during the accounting period. As the company performed the services to the customer, so the company earned the revenue. So, we debit Accounts Receivable Account  with an amount of $10,000  as the amount of revenue not yet received by the company from the customer and credit Sales Revenue Account . You May Also Be Interested In "A Company Receives $10,000 In Cash For Services Yet To Be Performed. Using The Accrual Method, What's The Correct Entry To Record The Transaction"? Under Accrual Basis of Accounting, we record the transaction whether the cash is involved or not. That is why we record both types of transactions i.e., cash transactions and credit transactions. Due to this, we create accounts receivable, accounts payable, sales on account, purchases on account, etc. La...