A company uses 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	$ 383,000	debit
Net Sales	880,000	credit

All sales are made on credit. Based on past experience, the company estimates that 0.5% of net sales are uncollectible. What amount should be debited to Bad Debts Expense when the year-end adjusting entry is prepared?

Multiple Choice

• $1,243

• $1,823

• $3,830

• $4,400

• $4,990