QUESTION 1 (8 marks) Prepare the adjusting journal entries to record the credit losses for the following independent situations Required: (Explanation for the journal entry is NOT required.) a. The Allowance for Impairment has a $1,500 credit balance prior to adjustment. Net credit sales during the year are $425,000 and 4% are estimated to be uncollectible. Assume the income statement approach is used. (2 marks) b. The Allowance for Impairment has a $300 debit balance prior to adjustment. Based on an aging schedule of accounts receivable prepared on December 31, $18,100 of accounts receivable are estimated to be uncollectible. Assume the statement of financial position approach is used. (4 marks) (2 marks) c. Explain how the transaction in (b) affects the accounting equation