Requirements 1. Journalize Winter's Bad Debts Expense using the percent-of-sales method. 2. Show how to report accounts receivable on the balance sheet at December 31, 2018. During its first year of operations, Winter Retreats earned net credit sales of $305,000. Industry experience suggests that bad debts will amount to 1% of net credit sales. At December 31,2018 , accounts receivable total $40,000. The company uses the allowance method to account for uncollectibles. Read the Requirement 1. Journalize Winter's Bad Debts Expense using the percent-of-sales method. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.)