CK Co. has net credit sales of $400,000 at the end of the year. They estimate uncollectible accounts to be 2% of net credit sales. Before any adjustments to their allowance for doubtful accounts for the current year, the unadjusted balance in this account was a debit of $1,500. What is the balance of the allowance for doubtful accounts after the adjusting entry is posted?

Select one:

a.

$1,500 credit.

b.

$8,000 credit.

c.

$6,500 credit.

d.

$9,500 credit.