Recording estimated bad debts Chekov Company uses the allowance method to account for bad debts. On December 31, 2020, the following information was available: Net Sales $4,620,000 Accounts Receivable $1,440,000 Required: In Workpaper #2, give the adjusting general journal entry required on December 31, 2020 to record estimated bad debts assuming: 1. Bad debts are estimated at 3% of net sales; the unadjusted balance of the Allowance for Bad Debts account is $23,500 credit. 2. Bad debts are estimated at 3% of net sales: the unadjusted balance of the Allowance for Bad Debts account is $28,200 debit. 3. Bad debts are estimated at 9% of accounts receivable; the unadjusted balance of the Allowance for Bad Debts account is $23,500 credit. 4. Bad debts are estimated at 9% of accounts receivable; the unadjusted balance of the Allowance for Bad Debts account is $28,200 debit. Exam Workpaper #2 Recording Estimated Bad Debts GENERAL JOURNAL Date Account Titles DR CR Case 1 Case 2 Case 3 Case 4 Based on your journal entries, indicate the balances of the accounts that would be reported on the financial statements on December 31, 2020: On the Income Statement: On the Balance Sheet: CASE Bad Debts Expense Allowance for Bad Debts Cash Realizable Value of Accounts Receivable 1 1 2 3 4