A Newly Created Design Business,Teri's Art,is Finishing Its First Year

Multiple Choice

A newly created design business,Teri's Art,is finishing its first year of operations.During the year,credit sales were $43,000 and collections of credit sales were $35,000.One account for $600 was written off.Teri's Art uses the aging-of-receivables method to account for bad debts expense.It has estimated $275 as uncollectible at year-end.What is the amount of the Bad Debts Expense for the first year of operations?

A) $7125
B) $600
C) $275
D) $875