1. Entity G uses the percentage of receivables method for recording bad debts expense. The accounts receivable balance is $500,000. Management estimates that 5% of accounts receivable will be uncollectible. What adjusting entry will Entity G make if the Allowance for Doubtful Accounts has a credit balance of $4,000 before adjustment?

   		Dr. Bad Debt Expense 21,000 Cr. Accounts Receivable 21,000
   		Dr. Bad Debt Expense 21,000 Cr. Allowance for Doubtful Accounts 21,000
   		Dr. Bad Debt Expense 25,000 Cr. Allowance for Doubtful Accounts 25,000
   		Dr. Allowance for Doubtful Accounts 29,000 Cr. Bad Debt Expense 29,000