Paul Anchor, Incorporated estimated that bad debt expense would equal 4% of net credit sales for the

Question:

Paul Anchor, Incorporated estimated that bad debt expense would equal 4% of net credit sales for the current year. The company reported this year’s net credit sales at $ 2,500,000 and included a $ 69,000 credit balance in the allowance for uncollectible accounts prior to the year- end adjustment. Prepare the adjusting journal entry to record bad debt expense for the current year.