An aging of a company's accounts receivable indicates that $3140 are estimated to be uncollectible. If Allowance for Doubtful Accounts has a $820 debit balance, the adjustment to record bad debts for the period will require a: a. debit to Bad Debt Expense for $3140.
b. credit to Allowance for Doubtful Accounts for $820.
c. debit to Bad Debt Expense for $3960.
d. debit to Bad Debt Expense for $2320.

c. debit to Bad Debt Expense for $3960.

Explanation:

The journal entry to record the bad debt expense is shown below;

Bad debt expense Dr ($3,140 + $820)   $3,960

         To Allowance for doubtful debts $3,960

(Being the bad debt expense is recorded)

For recording this we debited the bad debt expense as it increased the expenses and credited the allowance for doubtful debts as it decreased the assets

Therefore option c is correct

consumer credit. an advantage is that it allows consumers to afford expensive goods and services now, increasing their standard of living. however, a disadvantage is that it creates a trap for debt, if people do not have self control, they may see themselves filing personal bankruptcy.