Question 1. During 2001, a corporation recorded sales as follows: Cash sales, $300,000, and credit sales, $150,000. At 12/31/01, before the adjusting entries, Accounts receivable showeda debit balance of $90,000 and Allowance for Doubtful Accounts showed a credit balance of $600. Required: (a) Assuming a bad debt of $150 is to be written off, give the journal entry on 12/31/01. (b) Give the adjusting entry for bad debt expense at 12/31/01, assuming bad debt losses are estimated to be 1 percent of credit sales. (c) Give the adjusting entry for bad debt expense at 12/31/01, assuming instead that bad debt losses are estimated to be 2 percent of the balance in the Accounts receivable account (take transaction (a) into account). Question 1. During 2001, a corporation recorded sales as follows: Cash sales, $300,000, and credit sales, $150,000. At 12/31/01, before the adjusting entries, Accounts receivable showeda debit balance of $90,000 and Allowance for Doubtful Accounts showed a credit balance of $600. Required: (a) Assuming a bad debt of $150 is to be written off, give the journal entry on 12/31/01. (b) Give the adjusting entry for bad debt expense at 12/31/01, assuming bad debt losses are estimated to be 1 percent of credit sales. (c) Give the adjusting entry for bad debt expense at 12/31/01, assuming instead that bad debt losses are estimated to be 2 percent of the balance in the Accounts receivable account (take transaction (a) into account)