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At December 31, 2017, Hawke Company reports the following results for its calendar year.

Cash sales	$	1,905,000
Credit sales		5,682,000

In addition, its unadjusted trial balance includes the following items.

Accounts receivable	$	1,270,100	debit
Allowance for doubtful accounts		16,580	debit

Required: 1. Prepare the adjusting entry for this company to recognize bad debts under each of the following independent assumptions.

a. Bad debts are estimated to be 1.5% of credit sales.

b. Bad debts are estimated to be 1% of total sales.

c. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible.

Adjusting entries (all dated December 31, 2017).

1a. Bad debts are estimated to be 1.5% of credit sales.

	Transaction General Journal Debit Credit a.

1b. Bad debts are estimated to be 1% of total sales.

	Transaction General Journal Debit Credit b.

1c. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible.

	Transaction General Journal Debit Credit c.

2. Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December 31, 2017, balance sheet given the facts in part 1a.

	Current assets:

3. Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December 31, 2017, balance sheet given the facts in part 1c.

	Current assets:

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