Dean’s Sports Posters, Inc. had sales on account of $260,000 last year. Sales returns and allowances were $1,200, and Sales discounts were $800.

Dean’s Sports Posters, Inc. had sales on account of $260,000 last year. Sales returns and allowances were $1,200, and Sales discounts were $800. Accounts receivable balance at the end of the year was $25,000.  Pre-adjusted allowance for bad debts balance was $1,525. Prepare the journal entry to record bad debts for the year if Dean estimates its bad debts at 1% of net credit sales