$4$

$!$

Required information

Problem $7-2$A $($Algo$)$ Estimating and reporting bad debts LO P$2,$ P$3$

$[$The following information applies to the questions displayed below.$]$

At December $31,$ Hawke Company reports the following results for its calendar year.

points

Cash sales $$400,000$

Credit sales $$1,000,000$

In addition, its unadjusted trial balance includes the following items.

Accounts receivable

$$900,000$ debit

Allowance for doubtful accounts $,$$$7,200$ debit

Problem $7-2$A $($Algo$)$ Part $2$

$2.$ Bad debts are estimated to be $4\%$ of credit sales. Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December $31$ balance sheet.

$\backslash$table$[[$Current assets:,,$],[$Accounts receivable,,$