3. During the current year Hamid Incorporated recorded credit sales of of $690,000. Based on previous experience, it estimates a 4.5% bad debt rate on credit card sales.

a. Prepare journal entries for each of the following transactions:

i. On November 26 of the current year, an account receivable for $2900 from a prior year was determined to be uncollectable and was written off.

ii. At year end, the appropriate bad debt expense adjustment was recorded for the current year.

b. Complete the following tabulation, indicating the amount and effect (+ for increase; - for decrease; and, NE for no effect) of each transaction.

Transaction	Net Sales	Gross Profit	Income from Operation
i
ii