Duncan Company reports the following financial information before adjustments.

	Dr.	Cr.
Accounts Receivable	$100,000
Allowance for Doubtful Accounts		$2,000
Sales Revenue (all on credit)		900,000
Sales Returns and Allowances	50,000

Instructions

Prepare the journal entry to record Bad Debt Expense assuming Duncan Company estimates bad debts at 

(a) 5% of accounts receivable and 

(b) 5% of accounts receivable but Allowance for Doubtful Accounts had a $1,500 debit balance.