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