Answer:
Dr. Bad Debt Expense             $8,000
Cr. Allowance for Doubtful Accounts $8,000
Explanation:
Bad debt Expense will be calculated using the percentage of debt loss. The expense will be calculated using the account receivable balance.
Closing Value of the Allowance for Doubtful Accounts will be as follow
Closing Balance = $200,000 x 5% = $10,000
As the Allowance for Doubtful Accounts already has $2,000 credit balanced we need to adjust the balance to make it $10,000 credit balance.
Adjustment = $10,000 - $2,000 = $8,000
Answer:
Debit bad debt $8000
Credit allowance for doubtful account  $8000
Explanation:
Account receivable balance = $200,000
Credit sales $1,000,000
Uncollectible estimate = Â 5% of account receivable
5% *200000 = $10,000
Allowance for doubtful account = $2000
Adjustment entry = $10,000-$2,000 = $8000
Adjusting entry Dr bad debts $8000
Credit allowance for  doubtful account - $8000
