the allowance for doubtful accounts is ______.
The allowance for doubtful accounts is ______
Answer: The allowance for doubtful accounts is a contra-asset account that is associated with accounts receivable and serves to reflect the amount of accounts receivable that are expected to be uncollectible. This allowance is an estimated amount based on past experiences, current economic conditions, and other factors. It is used to adjust the accounts receivable balance on the balance sheet to report the net realizable value of accounts receivable. In other words, it is an amount set aside by a company to cover potential losses from customers who may not pay their outstanding invoices. The allowance for doubtful accounts is established through an adjusting entry at the end of each accounting period to ensure that the balance sheet accurately reflects the true value of accounts receivable.