A company used the percent of sales method to determine its bad debts expense. At the end of the current year, the company's unadjusted trial balance reported the following selected amounts: Accounts receivable 303,500 debit Allowance for uncollectible accounts 365 credit Net sales 1,095,000 credit. All sales are made on credit. Based on past experience, the company estimates 0.5% of credit sales to be uncollectible. What amount should be debited to Bad Debts Expense when the year-end adjusting entry is prepared?

$5,475

$1,518

$2,738

$54,750

$1,152