York Company opened for business on January 1, 2020. The firm had total credit sales of $150,000 during 2020. York Company collected $120,000 from customers during 2020. York Company estimated that 3% of the credit sales in 2020 would be uncollectible. During 2020, the firm wrote off $2,000 of accounts receivable as uncollectible. The firm uses the percentage-of-sales procedure to estimate bad debts expense. York Company will report the following in its 2020 financial statements:

Select one:

a. Bad debts expense $4,500; Allowance for uncollectibles $4,500

b. Bad debts expense $4,500; Allowance for uncollectibles $2,500

c. Bad debts expense $2,500; Allowance for uncollectibles $4,500

d. Bad debts expense $2,500; Allowance for uncollectibles $2,500

e. Bad debts expense $6,500; Allowance for uncollectibles $4,500