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The Allowance for Bad Debts account has a credit balance of $2,000 before the adjusting entry for bad debt expense.The company's management estimates that 2%

The Allowance for Bad Debts account has a credit balance of $2,000 before the adjusting entry for bad debt expense.The company's management estimates that 2% of net credit sales will be uncollectible for the year 2015.Net credit sales for the year amounted to $250,000.What will be the balance of the Allowance for Bad Debts reported on the balance sheet at December 31, 2015?

  • $7,000
  • $7,275
  • $5,285
  • $3,075

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