Estimating Bad Debts from Receivables Balances

The following information is extracted from Shelton Corporation's accounting records at the beginning of 2013: Accounts Receivable $64,000 Allowance for Doubtful Accounts 2,000 (credit) During 2013, sales on credit amounted to $582,000, $555,900 was collected on outstanding receivables and $2,900 of receivables were written off as uncollectible. On December 31, 2013, Shelton estimates its bad debts to be 4% of the outstanding gross accounts receivable balance.

Required: 1. Prepare the journal entry necessary to record Shelton's estimate of bad debt expense for 2013