Pacioli Corporation had a beginning balance of $8,000 credit in its allowance for doubtful account on January 1, 2020. During 2020 the company had $530,000 of credit sales and collected $490,000 of the accounts receivable during the year. During the year it wrote off $7,000 of bad debt as uncollectable. At the end of 2020 it had the following information in its aging schedule: $20,000 was not due yet and had a 4% chance of not being collected, $15,000 was overdue by 30 days and had a 10% of not being collected, and $5,000 was overdue by 60 days and had a 50% chance of not being collected. Using the aging method, what is the bad debt expense that Pacioli Corporation needs to record for 2020? a. $4,800 b. $3,800 c. $3,200 d. $10,200 e. $25,000

Can you explain why with full workings.