Emerz Corporation had sales of $850,000, of which 20% were cash sales. As of year-end, the balance in the Allowance for Uncollectible Accounts before adjusting for bad debts was a $400 debit. The company estimates bad debts as 10% of ending accounts receivable or 1.5% of credit sales. What is the journal entry that Emerz Corporation will make if it estimates bad debts by using a percentage of credit sales?

a. Bad debts Expense 9,800

Allowance for Uncollectible Accounts9,800

b. Bad debts Expense 10,200

Allowance for Uncollectible Accounts10,200

c. Bad debts Expense 10,600

Allowance for Uncollectible Accounts10,600

d. Bad debts Expense 12,350

Allowance for Uncollectible Accounts12,350

e. Bad debts Expense 12,750

Allowance for Uncollectible Accounts12,750