Required informationExercise $7-7$A $($Algo$)$ Effect of recognizing uncollectible accounts on the financial statements: Percent of receivables allowance method LO $7-2[$The following information applies to the questions displayed below.$)$Leach Incorporated experienced the following events for the first two years of its operations:Year $1$:$1.$ Issued $$10,000$ of common stock for cash$\mathrm{.}2.$ Provided $$60,000$ of services on account$\mathrm{.}3.$ Provided $$27,000$ of services and received cash$\mathrm{.}4.$ Collected $$33,000$ cash from accounts receivable$\mathrm{.}5.$ Paid $$18,000$ of salaries expense for the year$\mathrm{.}6.$ Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that $7$ percent of the ending accounts receivable balance will be uncollectible.Year $2$:$1.$ Wrote off an uncollectible account for $$740\mathrm{.}2.$ Provided $$80,000$ of services on account$\mathrm{.}3.$ Provided $$20,000$ of services and collected cash$\mathrm{.}4.$ Collected $$62,000$ cash from accounts receivable$\mathrm{.}5.$ Paid $$26,000$ of salaries expense for the year$\mathrm{.}6.$ Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that $7$ percent of the ending accounts receivable balance will be uncollectible.Exercise $7-7$A $($Algo$)$ Part dd$-1.$ Organize the transaction data in accounts under an accounting equation for Year $2.$ d$-2.$ Prepare an income statement for Year $2.$d$-3.$ Prepare the statement of changes in stockholders' equity for Year $2.$ d$-4.$ Prepare the balance sheet for Year