Use the following information for Questions 44 and 45: Your company shows the following data at the end of its first year: Credit sales for the year $1,000,000 Accounts Receivable balance 100,000 Allowance for Doubtful Accounts 4,000 credit balance

If your company estimates that it will not collect 5% of its accounts receivable, the year-end adjustment to Allowance For Doubtful Accounts will be . . .

a. a credit of $1,000. b. a credit of $5,000. c. a debit of $1,000. d. a debit of $5,000.