acc 100 3

Haven Company uses the percentage of sales method for recording bad debts expense. For the year, cash sales are $600,000 and credit sales are $2,700,000. Management estimates that 1% is the sales percentage to use. What adjusting entry will Haven Company make to record the bad debts expense?

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Bad Debt Expense   27,000       Accounts Receivable       27,000

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Bad Debt Expense   27,000       Allowance for Doubtful Accounts       27,000

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Bad Debt Expense   33,000       Allowance for Doubtful Accounts       33,000

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Bad Debt Expense   33,000       Accounts Receivable       33,000