Novak Corp. uses the percentage-of-receivables method for recording bad debt expense. The Accounts Receivable balance is $430000 and credit sales are $1720000. Management estimates that 5% of accounts receivable will be uncollectible. What adjusting entry will Novak Corp. make if the Allowance for Doubtful Accounts has a credit balance of $4300 before adjustment?
A Bad Debt Expense
12900
Accounts Receivable
12900
B Bad Debt Expense
8600
Allowance for Doubtful Accounts
8600
C Bad Debt Expense
25800
Allowance for Doubtful Accounts
25800
D Bad Debt Expense
17200
Allowance for Doubtful Accounts
17200
