Evan Incorporated uses the Percentage of Accounts Receivable method to calculate its Allowance for Doubtful Accounts. At fiscal year-end January 31, 2020, its Accounts Receivable balance was $247,841. Based upon prior experience and adjusted for current economic conditions, Evan believes that 3.8% of the Accounts Receivable will prove to be uncollectable.

Requirement:

Prepare the necessary adjusting entries to record Evan Incorporateds Bad Debt Expense for its fiscal year ended January 31, 2020 under the following two assumptions:

1. The Allowance for Doubtful Accounts balance as of January 31, 2020 before adjustments is
   1. A Credit balance of $2,792
   2. A Debit balance of $3,489