Fan-Tastic Sports Gear recorded $2,900,000 of sales last year and projects sales to increase by $360,000 in the current year. Last year, 90% of sales were on account, with over 300 customer accounts. Bad debt expense was $26,187.

1. Assume that Fan-Tastic Sports Gear used the allowance method last year, and the allowance account at the end of the year had a debit balance of $2,190. The company estimated uncollectible accounts expense using the percent of credit sales method and expected 0.75% of credit sales to be uncollectible. What is the amount of the adjusting entry to provide for doubtful accounts on December 31? Round all computations to the nearest dollar.

2. How much higher (lower) would Fan-Tastic Sports Gears net income have been under the allowance method assumption in (1) than under the direct write-off method? (Enter 0 if there is no change.) by

3. Using the allowance method, the net realizable value of the receivables would appear on which financial statement?