Mills Corporation's Balance Sheet Included the Following Information If the Allowance Account Had a Credit Balance of $27,500

Multiple Choice

Mills Corporation's balance sheet included the following information: $$\begin{array} { l r } \text { Accourts Receivable } & \$ 500,000 \\\text { Less: Allowarce for Doubtful Accourts } & 65,000 \\\text { Accounts Receivable, Net of Allowarce } & \$ 35,000\end{array}$$ If the Allowance account had a credit balance of $27,500 immediately before the year-end adjustment for bad debts and no accounts were written-off or allowed for during the year,what was the amount of Bad Debt Expense recognized during the year?

A) $65,000
B) $27,500
C) $32,500
D) $37,500