Blue Jay Corporation's accounts receivable balance is $$70,000$ at year end, and the total credit sales were $$600,000.$ Using an aging

schedule, management estimates that $$4,000$ of receivables will be uncollectible. What adjusting entry will have to be made if the

Allowance for Expected Credit Losses has a credit balance of $$500$ before adjustment?

Credit Losses

$3,500$

Accounts Receivable

$3,500$

Credit Losses

$3,500$

Allowance for Expected Credit Losses

$3,500$

Credit Losses

$4,000$

Allowance for Expected Credit Losses

$4,000$

Credit Losses

$4,500$

Allowance for Expected Credit Losses

$4,500$