Assume the following unadjusted account balances at the end of the accounting period: Accounts Receivable, $50,000; Allowance for Doubtful Accounts, $700 (debit balance); and Net sales, $600,000. If the company's past experience indicates credit losses of 1% of net sales, the adjusting entry to estimate uncollectible accounts is:

Select one:

A.

Bad Debts Expense

6,000

Accounts Receivable

6,000

B.

Bad Debts Expense

5,300

Allowance for Doubtful Accounts

5,300

C.

Bad Debts Expense

6,700

Allowance for Doubtful Accounts

6,700

D.

Bad Debts Expense

6,000

Allowance for Doubtful Accounts

6,000

E. None of the above