The financial statements for Anne Teak's Knick Knack Storeshow the following balances as ofDecember 31, 2014:

• Cash Sales: $1,500,000
• Credit Sales:$6,800,000
• Sales Returns and Allowance:$85,000
• Sales Discounts:$228,000
• Accounts Receivable: $1,900,000
• Allowance for Doubtful Accounts:$54,000 (Credit)
• Notes Receivable:$320,000

QUESTIONS:

1. An aging of accounts receivable indicates that $186,000 is expected to become uncollectible as of December 31, 2014.If the percentage of receivables method is used, whatis the balance is Allowance for Doubtful Accountsafterany adjustment is made? (1 point)
2. Ignoring your answer to Question #1, based on its past history, Ivana Huggnow Corporation expects 3% of its net credit sales will become uncollectible as of December 31, 2014. If the percentage of net credit sales method is used, what adjusting entry, if any, should Anne Teak's Knick Knack Storemake? (2 points)
3. The notes receivable consists of a single 4-monthnote, bearing interest at 8%. This note was given to Anne Teak's Knick Knack Store, by its customer, Ty Coonon October1, 2014. What adjusting entry, if any, should Anne Teak's Knick Knack Storemake on December 31, 2014? (2 points)

SPECIFIC INSTRUCTIONS: If a journal entry is required,typeyour response in the following format:

DR (account name) $(amount)

CR (account name) $(amount)