Entries for bad debt expense.

The trial balance before adjustment of Risen Company reports the following balances:

Accounts receivable Debit $150,000

Allowance for doubtful accounts Credit $2,500

Sales (all on credit) Credit $850,000

Sales returns and allowances Debit 40,000

Instructions

(a) Prepare the entries for estimated bad debts assuming that doubtful accounts are estimated to be (1) 6% of gross accounts receivable