Accounting and the Time Value of Money Expected Cash Flows Hiteck Electronics sells a diagnostic machine to a hospital with a four-year payment plan. The company would like to estimate the bad debt allowance needed to cover the notes outstanding over the next four years. Estimated lost cash flows and the probability of occurrence for each of the next four years are summarized in the following schedule. Projected Cash Flow Loss from Uncollected Notes Probability of Loss Occurring Year 2023 $8,000 90% 18,000 10% 2024 $10,000 15% 22,000 70% 45,000 15% 2025 $6,000 85% 14,000 15% 2026 $26,000 50% 35,000 50% Risk-free rate 8% Use the blue shaded areas on the ENTERANSWERS tab for inputs. Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instruction tab you will be marked wrong. Requirement What is the estimated bad debt allowance at December 31, 2022? Saving & Submitting Solution 1 Save file to desktop. a. Create folder on desktop, and label COMPLETED EXCEL PROJECTS b. Save your solution in the folder you just created; add -solution-date to end of file name 2 Upload and submit your file to be graded. Navigate back to the activity window-screen where you downloaded the initial spreadsheet Click Choose button under step 3; locate the file you just saved and click Open a. b. C. Click Upload button under step 3 d. Click Submit button under step 4 Viewing Results 1 Click on Results tab in MyAccountingLab 2 Click on the Assignment you were working on 3 Click on Project link; this will bring up your Score Summary 4 Within Score Summary window, click on Download (upper right) to download the spreadsheet with feedback What is the estimated bad debt allowance at December 31, 2022? (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instruction tab you will be marked wrong.) Year 2023 2024 2025 2026 Total Present Value (PV) Future value (FV) Project Description: GRS3e P7-14 Steps to Perform: Step Instructions Points Possible What is the estimated bad debt allowance at December 31, 2022? (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instruction tab you will be marked wrong.) 5