Alpha Electronics sells electronic products to customers on credit terms. At the end of the fiscal year, the company provides the following information:

• Total credit sales for the year: $1,500,000
• Allowance for doubtful accounts balance at the beginning of the year: $20,000
• Uncollectible accounts written off during the year: $15,000
• Bad debt expense estimated as a percentage of credit sales: 2% of net credit sales

Additionally, the company's aging schedule indicates that $25,000 of accounts receivable are past due but not yet written off.

Prepare journal entries to record bad debt expense for the year, taking into account the estimated allowance for doubtful accounts. Provide explanations for each journal entry and discuss the impact of bad debt estimation on Alpha Electronics' financial statements.