a.	Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 4% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method.

b.	Prepare the adjusting entry to record Bad Debts Expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $13,600 credit and $2,600 debit.

Daly Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis. Days Past Due Total $650,000 Accounts receivable Percent uncollectible 0 $412,000 2% 1 to 30 $106,000 3% 31 to 60 $52,000 6 % 61 to 90 $34,000 8 % Over 90 $46,000 11%