9-4A (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 a. Sold $1,348,000 of merchandise on credit (that had cost $978,300), terms n/30. b. Wrote off $21,700 of uncollectible accounts receivable. c. Received $671,000 cash in payment of accounts receivable. d. In adjusting the accounts on December 31, the company estimated that 1.40% of accounts receivable would be uncollectible. Year 2 e. Sold $1,503,400 of merchandise (that had cost $1,273,100) on credit, terms n/30. f. Wrote off $32,800 of uncollectible accounts receivable. g. Received $1,313,700 cash in payment of accounts receivable. h. In adjusting the accounts on December 31, the company estimated that 1.40% of accounts receivable would be uncollectible. Required: Prepare journal entries to record Liang's Year 1 and Year 2 summarized transactions and its year-end adjustments to record bad debts expense. (The company uses the perpetual inventory system, and it applies the allowance method for its accounts receivable.) Note: Round your intermediate calculations to the nearest dollar. Complete this question by entering your answers in the tabs below. Journal Entry Journal Entry Year 1 Year 2 Prepare journal entries to record Liang's Year 1 summarized transactions and its year-end adjustments to record bad debts expense. (The company uses the perpetual inventory system, and it applies the allowance method for its accounts receivable.) View transaction list Journal entry worksheet 1 2 3 4 5 Sold $1,348,000 of merchandise on credit, terms n/30. Note: Enter debits before credits. Transaction General Journal Debit Credit Journal entry worksheet 1 2 3 4 5 Sold $1,348,000 of merchandise on credit, terms n/30. Note: Enter debits before credits. Transaction a(1) General Journal Debit Credit View general journal Record entry Clear entry > Journal entry worksheet 1 2 3 4 5 Record cost of goods sold, $978,300. Note: Enter debits before credits. Transaction a(2) General Journal Debit Credit View general journal Record entry Clear entry Journal entry worksheet < 1 2 3 4 5 Wrote off $21,700 of uncollectible accounts receivable. Note: Enter debits before credits. Transaction b. General Journal Debit Credit View general journal Record entry Clear entry Journal entry worksheet < 1 2 3 4 5 Received $671,000 cash in payment of accounts receivable. Note: Enter debits before credits. Transaction C. General Journal Debit Credit View general journal Record entry Clear entry > Journal entry worksheet 1 2 3 4 50 In adjusting the accounts on December 31, the company estimated that 1.40% of accounts receivable would be uncollectible. Note: Enter debits before credits. Transaction d. General Journal Debit Credit Record entry Clear entry View general journal Journal entry worksheet 1 2 3 4 5 Sold $1,503,400 of merchandise on credit, terms n/30. Note: Enter debits before credits. Transaction e(1) General Journal Debit Credit View general journal Record entry Clear entry > Journal entry worksheet > 1 2 3 4 5 Record cost of goods sold, $1,273,100. Note: Enter debits before credits. Transaction e(2) General Journal Debit Credit Record entry Clear entry View general journal > Journal entry worksheet 1 2 3 4 5 Wrote off $32,800 of uncollectible accounts receivable. Note: Enter debits before credits. Transaction f. General Journal Debit Credit > View general journal Record entry Clear entry Journal entry worksheet < 1 2 3 + 5 Received $1,313,700 cash in payment of accounts receivable. Note: Enter debits before credits. Transaction g. General Journal Debit Credit > View general journal Record entry Clear entry Journal entry worksheet < 1 2 3 4 LO 5 In adjusting the accounts on December 31, the company estimated that 1.40% of accounts receivable would be uncollectible. Note: Enter debits before credits. Transaction h. General Journal Debit Credit Record entry Clear entry View general journal