Give the entry for estimated bad debts assuming that the

Question

Question - Computing Bad Debts and Preparing Journal Entries

The trial balance before adjustment of Estefan Inc. shows the following balances.

                                                      Dr.                          Cr.

Accounts Receivable                         $80,000                                 

Allowance for Doubtful Accounts        1,750                                     

Sales (all on credit)                                                        $580,000             

Give the entry for estimated bad debts assuming that the allowance is to provide for doubtful accounts on the basis of (a) 4% of gross accounts receivable and (b) 1% of net sales.