A Firm Reported Net Credit Sales of $355,000 for the Year

Multiple Choice

A firm reported net credit sales of $355,000 for the year and an Accounts Receivable balance of
$20,000 at year-end. Prior to adjustments, Allowance for Doubtful Accounts has a debit balance of
$250. The firm estimates its losses from uncollectible accounts to be one-half of 1 percent of net credit sales. The entry to record the estimated losses from uncollectible accounts will include a credit to Allowance for Doubtful Accounts for

A) $1,775.
B) $2,025.
C) $1,525.
D) $3,550.