The percentage of credit sales method attempts to estimate the ending balance in Bad Debt Expense by forming estimates based on past experience with uncollectible accounts.

Conceptual Connection: If Gilmore's estimate of bad debts is correct $(1\mathrm{.}75\%$ of credit sales$)$ and the gross margin is $20\%,$ by how much did filmore's income from operations increase assuming

$$150,000$ of the sales would have been lost if credit sales were not offered?