On December 31 of the current year, the unadjusted trial balance of a company using the percent of receivables method to estimate bad debt included the following: Accounts Receivable, debit balance of $100,000; Allowance for Doubtful Accounts, credit balance of $600; credit sales of $420,000. What amount should be debited to Bad Debts Expense, assuming 1% of credit sales are estimated to be uncollectible?
A. $3,600.
B. $4,200.
C. $5,660.
D. $4,800.
E. $5,770.
Answer: B
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