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Australia, Inc. had a $140,000 beginning balance in Accounts Receivable and a $5,000 credit balance...

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Accounting

Australia, Inc. had a $140,000 beginning balance in Accounts Receivable and a $5,000 credit balance in the Allowance for Doubtful Accounts. During the year, credit sales were $800,000 and customers accounts collected were $810,000. Also, $4,000 in worthless accounts were written off. An aging of the accounts indicates that 5% of the end-of-the-year Accounts Receivable balance is doubtful for collection. What amount of Bad Debts Expense should be provided at year-end?

Select one:

A. $7,300

B. $7,600

C. $6,300

D. $5,300

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