Required information

$[$The following information applies to the questions displayed below.$]$

At December $31,$ Hawke Company reports the following results for its calendar year.

Cash sales

Credit sales

$$220,000$

$$550,000$

In addition, its unadjusted trial balance includes the following items.

Accounts receivable

Allowance for doubtful accounts

$$495,000$ debit

$$4,000$ debit

Required:

Prepare the adjusting entry to record bad debts under each separate assumption.

a$.$ Bad debts are estimated to be $4\%$ of credit sales.

b$.$ Bad debts are estimated to be $3\%$ of total sales.

c$.$ An aging analysis estimates that $4\%$ of year$-$end accounts receivable are uncollectible.

Adjusting entries $($all dated December $31).$

Journal entry worksheet

Bad debts are estimated to be $4\%$ of credit sales.

Note: Enter debits before credits.

Date