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A company used the percent of sales method to determine its bad debts expense. At...

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Accounting

A company used the percent of sales method to determine its bad debts expense. At the end of the current year, the company's unadjusted trial balance reported the following selected amounts: Accounts receivable $250,000 debit Allowance for uncollectible accounts 400 credit Net Sales 810,000 credit All sales are made on credit. Based on past experience, the company estimates .20% of credit sales to be uncollectible. What amount should be debited to Bad Debts Expense when the year-end adjusting entry is prepared?

$500

$1,685

$1,620

$1,220

$2,020

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