(Computing Bad Debts and Preparing Journal Entries) The trial balance before adjustment of Estefan Inc. shows the following balances.

 

Dr.

Cr.

Accounts   Receivable

$80,000

 

Allowance   for Doubtful Accounts

1,750

 

Sales,   Net Revenue (all on credit)

 

$580,000  

Instructions

Give the entry for estimated bad debts assuming that the allowance is to provide for doubtful accounts on the basis of (a) 4% of gross accounts receivable and (b) 1% of net sales.