Problem 7-2A Estimating and reporting bad debts LO P2, P3 [The following information applies to the questions displayed below At December 31, 2017. Hawke Company reports the following results for its calendar year. Cash sales Credit sales $1,562,840 3,687,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable Allowance for doubtful accounts $1,117,161 debit 12,110 debit To recognize bad debts under each of the following independent assumptions Bad debts are estimated to be 2% of credit sales. b. Bad debts are estimated to be 1% of total sales. c. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible Problem 7-2A Part 1 Required: 1. Prepare the adjusting entry for this company to recognize bad debts under each of the following independent assumptions. a. Bad debts are estimated to be 2% of credit sales. b. Bad debts are estimated to be 1% of total sales. C. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible. Adjusting entries (all dated December 31, 2017). View transaction list Journal entry worksheet 1 Bad debts are estimated to be 2% of credit sales