The account allowance for uncollectible accounts is classified as a(n contra account to uncollectible accounts expense. expense. liability. contra account to accounts receivable.
The account allowance for uncollectible accounts is classified as a contra account to accounts receivable.
Explanation:
It is a contra asset account. It is the allowance for bad debt reserve or doubtful actions.
Contra accounts are reported on the financial statement same as that of the associated account, appearing directly below the associated account with a [tex]3^{rd}[/tex] line for the net amount.
They are useful in preserving the historical value in main account while denoting a decrease in a separate contra account that sums to the current book value.
