The Allowance for Doubtful Debts Account Has a Credit Balance

Multiple Choice

The Allowance for doubtful debts account has a credit balance of $4000.The company's management estimates that 3% of net credit sales will be uncollectable for the year 2016.Net credit sales for the year amounted to $260,000.What will be the amount of Bad debts expense reported on the income statement for 2016?

A) $3900
B) $11,800
C) $7800
D) $3800