Use the following information provided to answer all questions related to Joy and her business:

Joy owns and operates a wildly successful gutter-clearing business. Prior to the year-end adjustment to record bad debt expense for Year 1, the general ledger of Joy's company included the following accounts and balances:

Allowance for Doubtful Accounts $1,000 credit balance

Accounts Receivable $200,000

Cash collection on accounts receivable during Year 1 amounted to $450,000. Sales revenue during Year 1 amounted to $800,000, of which 75% was on credit, and Joy estimated that 2% of these credit sales made in Year 1 would ultimately become uncollectible.

Question: Calculate Joy's bad debt expense for Year 1 using the percentage of credit sales method for estimating uncollectible accounts & what is the net realizable value of accounts receivable as of the end of Year 1?