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E7.9B (L03) (Computing Bad Debts and Preparing Journal Entries) The trial balance before adjustment of Santillan...

E7.9B (L03) (Computing Bad Debts and Preparing Journal Entries) The trial balance before adjustment of Santillan Inc. shows the following balances:
DEBITS CREDITS
Accounts Receivable   $180,000
Allowance for Doubtful Accounts    $3,500
Sales (all on account ) $1,000,000
Instructions
Give the entry for estimated bad debts assuming that the allowance is to provide for doubtful accounts on the basis of (
a) 5% of accounts receivable and
(b) 5% of accounts receivable but Allowance for Doubtful Accounts had a $2,500 DEBIT balance.
(C) 1% of Sales , Allowance has a $3,500 credit balance
Accts Rec Allowance For D/A Sales
           180,000             3,500        1,000,000

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