A company had the following items and amounts in its unadjusted trial balance as of December 31 of the current year: Credit $188,000 275,000 Debit Cash sales Credit sales Accounts receivable Allowance for doubtful accounts $76,000 1,000 Prepare the adjusting entry to estimate bad debts assuming bad debts are estimated to be 2.5% of credit sales. 3). A company that uses the percent of sales to account for its bad debts had credit sales of $740,000 in Year 1, including a $720 sale to Marshall Fresh. On December 31, Year i , the company estimated its bad debts at 1.5% of its credit sales. On June 1, Year 2, the company wrote off, as uncollectible, the $720 account of Marshall Fresh. On December 21, Year 2, Marshall Fresh unexpectedly paid his account in full. Prepare the necessary journal entries: (a) On December 31, Year 1, to reflect the estimate of bad debts expense (b) On June 1, Year 2, to write off the bad debt. (c) On December 21, Year 2, to record the unexpected collection