During the year ended December 31, 2015, Kellys camera shop had sales revenue of $180,000 of which $90,000 was on credit. At the start of 2015, accounts receivable showed a $12,000.00 debit balance and the Allowance if doubtful accounts showed a $620 credit balance . Collections of accounts receivable during 2015 amounted to 70,000.

On December 31, a decision was made to continue the accounting policy of basing estimates bad debt losses on 2 percent if credit sales for the year.

Give the required journal entry