! Required information Problem 7-2A (Algo) Estimating and reporting bad debts LO P2, P3 [The following information applies to the questions displayed below.] At December 31, Hawke Company reports the following results for its calendar year. Cash sales Credit sales $1,515,930 $3,682,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable Allowance for doubtful accounts $1,115,646 debit $ 16,550 debit Problem 7-2A (Algo) Part 1 Required: 1. Prepare the adjusting entry to record bad debts under each separate assumption. 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. 2. Bad debts are estimated to be 2% of credit sales. Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December 31 balance sheet. Current assets: 0 3. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible. Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December 31 balance sheet. (Do not round intermediate calculations.) Current assets