Question

If the credit balance of the Allowance for Doubtful Accounts account exceeds the amount of a...

If the credit balance of the Allowance for Doubtful Accounts account exceeds the amount of a bad debt being written off, the entry to record the write-off against the allowance account results in: A reduction in current assets. A reduction in current liabilities. No effect on the expenses of the current period. An increase in the expenses of the current period. A reduction in equity.

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Answer #1

Answer:

No effect on the expenses of the current period

Explanation to the answer:

If the credit balance of the Allowance for Doubtful Accounts account exceeds the amount of a bad debt being written off, the entry to record the write-off against the allowance account results in No effect on the expenses of the current period

It will not affect the expenses of the current period because this entry will make effect only on balance sheet accounts as the debit to Allowance for Doubtful A/C & credit to the Accounts Receivable A/C.

Here , expense or loss is not reported for income statement so we can say that It will not affect the expenses of the current period

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