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The Accounts Receivable balance for Computer Co. is $70,000 as of December 31st. Before calculating and recording Bad Debt Expense for the year, the Allowance for Doubtful Accounts has a credit balance of $80.
Problem 1: Assume Computer Co. uses the analysis of receivables method. What is the balance in the Allowance for Doubtful Accounts after Computer Co. records its adjustment entry relating to Bad Debt Expense?
Option 1: $1,950
Option 2: $2,000
Option 3: $1,920
Option 4: $2,030
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