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 $ 1,855,030 Credit sales 3,789,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable $ 1,148,067 debit Allowance for doubtful accounts 15,950 debit 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. Bad debts are estimated to be 3% of credit sales. Bad debts are estimated to be 2% of total sales. An aging analysis estimates that 6% of year-end accounts receivable are uncollectible. Adjusting entries (all dated December 31, 2017).