Debit Credit

Accounts receivable Debit $140,000

Allowance for doubtful accounts Credit 730

Sales Credit $610,000

Sales returns and allowances Debit 8,000

Prepare the journal entries for allowance for doubtful accounts when the estimate of uncollectible accounts is determined by taking 1) 5% of gross accounts receivable and 2) 3% of gross accounts receivable with a $730 debit allowance account balance.