this entries is incorrect. Dec. 17 Cash 2,450 Sales Discounts 50 Accounts Receivable 2,500 (To record collection of 12/4 sales, terms 2/10, n/30) 20 Cash 20,225 Notes Receivable 20,000 Interest Revenue 225 (Collection of $20,000, 4.5%, 90 day note dated Sept. 21. Interest had been accrued through Nov. 30.) 27 Cash 780 Bad Debt Expense. 780 (Collection of account previously written off as uncollectible under allowance method) 31 Bad Debt Expense, 400 Allowance for Doubtful Accounts 400 (To recognize estimated bad debts based on 1% of net sales of $400,000)