Question 2 (6 marks) The total account receivables of Michelle's Laundry Services have a balance of $300,000 at the end of 30 June 2015. The company uses the allowance method to record bad debts expense. The accountant prepares an ageing analysis of accounts receivable balance as at 30th June 2015 as below. On 30th June 2015 the credit balance of Allowance for doubtful debts account is $3,000 before any adjustments. (Ignore GST) AGE Estimated Uncollectable Estimated Bad Debts 1% Account Receivable BALANCE 200,000 70,000 30,000 $ 300,000 Not yet due Overdue by 1 month Overdue more than 2 months Total 3% 10% Required: a) Prepare the adjusting journal entry to record bad debts expense for the year ended 30 June (ignore notation). (4 marks) b) One month later, at 31 July 2015, the manager decided to write off $500 of accounts receivable that were doubtful. Prepare journal entry (ignore notation). (2 marks)