Allowance for Doubtful Accounts Has a Credit Balance of $1,300

Multiple Choice

Allowance for Doubtful Accounts has a credit balance of $1,300 at the end of the year (before adjustment) . The company prepares an analysis of customers' accounts to estimate the amount of uncollectible accounts of $41,900. Which of the following adjusting entries would be made to record the Bad Debt Expense for the year?

A) debit Allowance for Doubtful Accounts, $40,600; credit Bad Debt Expense, $40,600
B) debit Allowance for Doubtful Accounts $43,200; credit Bad Debt Expense, $43,200
C) debit Bad Debt Expense, $43,200; credit Allowance for Doubtful Accounts, $43,200
D) debit Bad Debt Expense, $40,600; credit Allowance for Doubtful Accounts, $40,600