Exercise 7-7 Percent of accounts receivable method LO P3 Mazie Supply Co. uses the percent of accounts receivable method. On December 31, it has outstanding accounts receivable of $105,500, and it estimates that 3% will be uncollectible. Prepare the year-end adjusting entry to record bad debts expense under the assumption that the Allowance for Doubtful Accounts. has: (a) a $1,794 credit balance before the adjustment. (b) a $528 debit balance before the adjustment. View transaction list Journal entry worksheet < 1 2 Prepare the year-end adjusting entry to record bad debts expense under the assumption that the Allowance for Doubtful Accounts has a $1,794 credit balance before the adjustment. Note: Enter debits before credits, Transaction (0) General Journal Debit Credit