(Solution) - The company had an Accounts Receivable balance of 85 000 and -(2025 Original AI-Free Solution)

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The company had an Accounts Receivable balance of $85,000 and an Allowance for Bad Debts balance of $3,400 (credit) at the end of the year (before any adjusting entry). Credit sales for the year totaled $860,000. The accountant determined that 1% of this year's credit sales will ultimately be uncollectible. Make the journal entry necessary to record bad debt expense for the year.