Exercise $7-16($Algo$)$ Estimating bad debts LO P$3$

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

Cash sales $$917,000$

Credit sales $317,000$

Its year$-$end unadjusted trial balance includes the following items.

Accounts receivable

Allowance for doubtful accounts

$$142,000$ debit

$6,700$ debit

Prepare the adjusting entry to record bad debts expense assuming uncollectibles are estimated to be $(1)4\%$ of credit sales, $(2)2\%$ of

total sales and $(3)7\%$ of year$-$end accounts receivable.

Journal entry worksheet

Record Bad Debts Expense assuming uncollectibles are estimated to be $4\%$ of

credit sales.

Note: Enter debits before credits.