Canton imports prepared the aging schedule below at December 31. (a) complete the aging schedule. (b) prepare the adjusting journal entry at December 31 to record bad debts expense assuming that the allowance account has a credit balance of $3600. (c) prepare the adjusting journal entry at December 31 to record bad debts expense, assuming that the allowance account has a debit balance of $5400

Number of Days Accounts Receivable Estimated Percentage Total Estimated

Outstanding Uncollectible Uncollectible Accounts

0-30 days $368,000 1%

31-60 days 120,000 4%

61-90 days 72,000 10%

Over 90 days 40,000 20%

Total $600,000

The following selected transactions occurred for Bluemortier Corp. the company uses a perpetual inventory system, has a May 31 year end, and adjusts its inventory annually.

Feb. 1 sold merchandise for $8,000 on account (n/30) to Morgan Ltd. The cost of goods sold was $6,000

Feb. 3 sold $13,400 of merchandise costing $8,800 to Gauthier Company and accepted Gauthiers two month, 6% note in payment. Interest is due in maturity

Feb. 26 sold $12,000 of merchandise to Mathias corp., terms n/30. The cost of merchandise sold was $7,600

Mar. 6 sold, on account, $4,000 of merchandise that cost $3,000 to superior Ltd.

Mar. 27 Accepted a two month, 7%, $12,000 note from Mathias for the balance due. Interest is due at maturity. (see Feb. 26 transaction)

Apr. 3 Collected the Gauthier note in full (see Feb. 3 transaction)

May 27 the Mathias note of Mar. 27 was dishonoured. It is expected Mathias will eventually pay the amount owed.

May 31 Recorded accrued interest for three months on outstanding interest on the receivable due from Morgan. Interest on unpaid receivables is charged at 24% per annum (2% per month). (see Feb. 1 transaction)

Record the above transactions