Required information [The following information applies to the questions displayed below.] On December 31, Year 1, the Loudoun Corporation estimated that 3% of its credit sales of $112,500 would be uncollectible. Loudoun uses the allowance method. On February 15, Year 2, one of Loudoun's customers failed to pay his $1,050 account and the account was written off. On April 4, Year 2, this customer paid Loudoun the $1,050. Assume that the Loudoun Corporation uses the direct write-off method. Which of the following correctly describes the effect of the write-off of the customer's account on Loudoun's financial statements? Stmt of Cash Flows Assets = Liab. Stk. Equity NA + Rev. Net Inc. Exp. NA A. NA NA NA NA NA B. NA (1,050) NA 1,050 (1,050) NA (1,050) (1,050) C. NA NA NA NA NA |(1,050) 1,050 D. NA (1,050) NA 1,050 (1,050) NA Option A Option B Option C Option D