The Allowance for Bad Debts account has a credit balance of $2,000 before the adjusting entry for bad debts expense. The company's management estimates that 2% of net credit sales will be uncollectible for the year 2017. Net credit sales for the year amounted to $270,000. What will be the balance of Allowance for Bad Debts on the December 31, 2017 balance sheet?

(a) $5,400

(b) $2,000

(c) $7,400

(d) $5,360