The Garvey Sign Company uses the allowance method in accounting for uncollectible accounts. Past experience indicates that 5% of accounts receivable will eventually be uncollectible. Selected account balances at December 31, 2011, and December 31, 2012, appear below:
12/31/2011 12/31/2012
Net Credit Sales CR. Balance $400,000 $500,000
Accounts Receivable DR. Balance 80,000 100,000
Allowance for Doubtful Accounts CR. Balance 4,000 -
Prepare the adjusting journal entry to record the bad debt provision for the year ended December 31, 2012.