Chapter 2 1. Nuance uses the percentage of receivables method to estimate uncollectible accounts and assumes that 5 percent of accounts receivable will never be collected. Nuance had accounts receivable of $100,000 at the end of the year. 1. Prepare the entry to record Nuance's bad debt expense for the year. 2. Show the net accounts receivable balance reported on the balance sheet. 3. Why are companies allowed to choose between methods of estimating bad debts instead of being required to use one method