7At December 31, 201X, Brooke's Horse Stable unadjusted Allowance for Doubtful Accounts showed a credit balance of $432. An aging of the Accounts Receivable indicates probable uncollectible accounts of $1,000. The year-end adjusting entry for Bad Debts Expense:

		includes a credit to the Allowance account for $568.
		includes a debit to the Allowance account for $42.
		includes a debit to the Allowance account for $822.
		includes a credit to the Allowance account for $1,432.

8Harry's Hardware estimates that approximately $1.75 out of every $100 of credit sales proves to be uncollectible. Harry calculates Bad Debts Expense using the:

		aging the Accounts Receivable approach.
		direct write-off method.
		balance sheet approach.
		income statement approach.