Problem 1: At the end of the current year accounts receivable had a debit balance of $1,000,000 and sales for the year were $2,000,000. Please journalize the adjusting entry under each of the following two scenarios:

1. The allowance account before adjustment has a credit balance of $50,000. Bad debt expense is estimated at 2% of net sales
2. The allowance account before adjustment has a credit balance of $50,000 an aging of the accounts in the in the customer ledger indicates estimated doubtful accounts at $190,000.