Exercise 7-7A Effect of recognizing uncollectible accounts on the financial statements: Percent of receivables allowance method LO 7-2 [The following information applies to the questions displayed below] Leach Inc. experienced the following events for the first two years of its operations: Year 1: 1. Issued $10,000 of common stock for cash. 2. Provided $90,000 of services on account. 3. Provided $29,000 of services and received cash. 4. Collected $61,000 cash from accounts receivable, 5. Paid $20,000 of salaries expense for the year. 6. Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 8 percent of the ending accounts receivable balance will be uncollectible. Year 2: 1. Wrote off an uncollectible account for $670. 2. Provided $110,000 of services on account 3. Provided $25,000 of services and collected cash. 4. Collected $92,000 cash from accounts receivable. 5. Paid $22,000 of salaries expense for the year. 6. Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 8 percent of the ending accounts receivable balance will be uncollectible. Help