The Watergate Company uses the allowance method of recording credit losses and wrote off a customer's account in the amount of $1,600. Later, the customer paid the account. The company reinstated the account by means of a journal entry and then recorded the collection. What is the result of these procedures?

a. Increases total assets by $1,600

b. Decreases total assets by $1,600

c. Decreases total assets by $3,200

d. Has no effect on total assets