Question 2 (10 marks) Below are 5 multiple choice items. Indicate the letter corresponding to the best answer for each item in the table below. M. C. Item Answer M. C. Item Answer 1 4 2 5 3 AT&U Company has the following data for the year ended December 31, Year 1: Sales (credit) $2,500,000 Sales returns and allowances 50,000 Accounts receivable (December 31, Year 1) 640,000 Allowance for doubtful accounts (before adjustment at December 31, Year 1, credit balance) 20,000 Estimated amount of uncollected accounts based on aging analysis (December 31, Year 1) 45,000 1. Refer to AT&U Company. If the company estimates its bad debts at 1% of net credit sales, what amount will be reported as bad debt expense for Year 1? a. $6,400 b. $24,500 c. $25,000 d. $45,000 2. Refer to AT&U Company. If the company uses the aging of accounts receivable approach to estimate its bad debts, what amount will be reported as bad debt expense for Year 1? a. $65,000 b. $45,000 c. $25.000 d. S20,000