At December 31, 2008, Ingleton Company reports the following results for the year.

Cash sales: $1,025,000

Credit sales: $1,342,000

In addition, its unadjusted trial balance includes the following items.

Accounts Receivable $575,000 debit

Allowance for doubtful accounts $7,500 credit

Required

Prepare the adjusting entry for Ingleton Co. to recognize bad debts under each of the following independent assumptions:

• Bad debts are estimated to be 2.5% of credit sales.

• Bad debts are estimated to be 1.5% of total sales.

• An aging analysis estimates that 6% of year-end accounts receivable are uncollectible