On April 1, ABC has an Accounts Receivable balance of $190,000. During the month, credit sales total $210,000. As a result of collections efforts, the aging of Accounts Receivable is as follows for April 30:

Current $100,000 (1% is estimated to be uncollectible)

0-30 Days Past Due $50,000 (5% is estimated to be uncollectible)

31-60 Days Past Due $20,000 (10% is estimated to be uncollectible)

31-90 Days Past Due $10,000 (20% is estimated to be uncollectible)

>90 Days Past Due $20,000 (50% is estimated to be uncollectible)

Balance in Allowance for Doubtful Accounts (prior to any April 30 entry) $5,000 Credit

If ABC is using the % of sales method of estimating its bad debts, what is the journal entry made at the end of the month if the estimated % of sales that are uncollectible is 4%?

Debit Bad Debt Expense $3,400

Credit Allowance for Doubtful Accounts $3,400

Debit Bad Debt Expense $12,500

Credit Allowance for Doubtful Accounts $12,500

Debit Bad Debt Expense $8,400

Credit Allowance for Doubtful Accounts $8,400

Debit Bad Debt Expense $13,400

Credit Allowance for Doubtful Accounts $13,400