Exercise 7-2A (Algo) Accounting for uncollectible accounts: allowance method LO 7-1 Holmes Cleaning Service began operation on January 1. Year 1. The company experienced the following events for its first year of operations: Events Affecting Year 1: 1. Provided $160,000 of cleaning services on account. 2. Collected $120,000 cash from accounts receivable. 3. Paid salaries of $26,000 for the year. 4. Adjusted the accounts to reflect management's expectations that uncollectible accounts expense would be $1,800. The expense was determined using the percent of revenue method. Requ d a. Organize the transaction data in accounts under an accounting equation. b. Prepare an income statement, a balance sheet, and a statement of cash flows for Year 1.