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Tanning Company analyzes its receivables to estimate uncollectible accounts. The accounts receivable balance is $390,000,...

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Accounting

Tanning Company analyzes its receivables to estimate uncollectible accounts. The accounts receivable balance is $390,000, and credit sales are $1,300,000. An aging of accounts receivable estimates that $19,500 of the outstanding receivables will be uncollectible. What adjusting entry will Tanning Company make if Allowance for Doubtful Accounts has a credit balance of $2,500 before adjustment?

a.

Account Debit Credit
Bad Debt Expense 19,500
Allowance for Doubtful Accounts 19,500

b.

Account Debit Credit
Bad Debt Expense 17,000
Allowance for Doubtful Accounts 17,000

c.

Account Debit Credit
Bad Debt Expense 22,000
Allowance for Doubtful Accounts 22,000

d.

Account Debit Credit
Bad Debt Expense 65,000
Allowance for Doubtful Accounts 65,000

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