Exercise $7-13($Algo$)$ Percent of accounts receivable method LO P$3$

Mazie Supply Company uses the percent of accounts receivable method. On December $31,$ it has outstanding accounts receivable of $$112,500,$ and it estimates that $5\%$ will be uncollectible.

Prepare the year$-$end adjusting entry to record bad debts expense under the assumption that the Allowance for Doubtful Accounts has:

$($a$)$ a $$1,913$ credit balance before the adjustment.

$($b$)$ a $$563$ debit balance before the adjustment.

$\backslash$table$[[,$No$,$Transaction,General Journal,Debit,Credit$],[i,1,($a$),$Bad debts expense,$7,538,],[,,,$Allowance for doubtful accounts,,$]]$