1. Laver Co. had the following balances at December 31. Accounts receivable Sales discounts Sales revenue Allowance for doubtful accounts Sales returns and allowances $250,000 2,000 325,000 2,000 (cr.) 10,000 Required: Prepare the adjusting entry to record bad debt expense assuming: a. The company estimates that 5% of net sales is uncollectible. b. The company estimates that 5% of accounts receivable is uncollectible. C. Calculate the ending balance of AFDA under both assumptions above (show all work). 2. Nicole's Desserts is a specialty bakery located in downtown Ithaca. The company recently reported the following information concerning the Allowance for Doubtful Accounts on its Balance sheet at the end of each of the following years. Ending Balance Beginning Balance Actual Account Write-Offs $5 ? 2016 2017 2018 Estimated Bad Debt Expense $ ? 185 20 $110 162 90 $162 90 92 18 Required: a. Use a t-account to compute the missing amounts for 2016. Label all amounts. b. Use a t-account to compute the missing amounts for 2017. Label all amounts. Record the journal entries to record the transactions for 2018. C