The records of Eric Company showed the following pre-adjustment information on December 31, 2011:
Net sales (80% on credit) $350,000
Accounts receivable $160,000
Allowance for doubtful accounts $4,100 (debit balance)
Prepare journal entries to record the estimates for bad debt expense assuming:
a) Bad debts are estimated to be 4% of credit sales.
b) Bad debts are estimated to be 3% of net sales.
c) An aging schedule determines that uncollectible accounts should be $13,000.