ABC, Inc. reports annual credit sales of $390,000 and accounts receivable balance of $85,000 with an allowance for bad debt of $5,000. ABC uses the income statement method to report bad debt estimation. If the estimation percentage is 3.5%, what is the estimated bad debt expense for the year? $ 2,975 $ 2,992 $29,925 $31,650

Question 4 Assuming the same information for ABC, Inc. from question #3, what is the estimated allowance for bad debt. $31,650 $29,925 $36,650 $95,000