E5-26A. (Learning Objective 4: Reporting bad debts by the allowance method) On December 31, Darla’s Travel has an accounts receivable balance of $85,000. Allowance for Doubtful Accounts has a credit balance of $680 before the year-end adjustment. Darla’s Travel estimates that doubtful-account expense for the year is equal to 8% of ending receivables. Make the yearend entry to record doubtful-account expense. Show how the accounts receivable and the allowance for doubtful accounts are reported on the Balance Sheet.