7-4A (Algo) Accounts receivable transactions and bad debts adjustments LO C1, P2, P3 Liang Company began operations in Year 1. During its first two years, the company completed a number of transactions involving sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows. Year 1 Sold $1,349,900 of merchandise on credit (that had cost $976,100), terms n/30. Wrote off $20,300 of uncollectible accounts receivable. Received $669,500 cash in payment of