How to compute allowance of bad debt? I as well need help figuring out May 1 and May 20th on the accounts recivable. I would as well like help on the adjusted journal entries.

56,254 ACCT 2690 - Accounting Theory Project BSG, Inc. started business on January 1, 2022. The following is a list of information that will pertain to this Corporation: BSG is a Corporation that sells 2 styles of Sneakers (Running and Aerobic) The company uses the perpetual FIFO method in accounting for its inventory. BSG makes its adjustments at the end of each year All sales and inventory are purchased on account Be sure to round all numbers to the nearest dollar (Do Not Use Cents). The company had the following Post-Closing Trial Balance at 12/31/2022 Account Name Debit Credit Cash Accounts Receivable 41,475 Allowance for Bad Debt 1,244 Inventory 92,000 Supplies on Hand Prepaid Insurance Land 75,000 Building 200,000 A/D- Building 4,700 Equipment 230,000 A/D - Equipment 32,867 Accounts Payable 23,200 Income Tax Payble 23,023 Interest Payable 6,808 Unearned Rent Dividend Payable 10,000 Notes Payable 170,000 Common Stock 100,000 APIC-Common Stock 200,000 Retained Earnings 122,737 400 50 600 BSG uses, the 200% double declining balance, Half Year, method to depreciate all 5, 7 & 10-year property BSG uses, the SL, mid-month basis to depreciate all real property Income tax rate is 35% The $230,000 of equipment has an expected life of 7 years and no salvage value The $200,000 building has an expected life of 39 years and no salvage value Inventory at 1/1/23 consists of: Running Sneakers - 500 units at $120 each Aerobic Sneakers - 400 units at $80 each Notes Payable at December 31, 2022 consisted of: Foley Bank - 50,000, 7% interest rate. Interest is paid on Feb 1" of each year, principal to be repaid on 2/1/2026 BSG, Inc. started business on January 1, 2022. The following is a list of information that will pertain to this Corporation: BSG is a Corporation that sells 2 styles of Sneakers (Running and Aerobic) The company uses the perpetual FIFO method in accounting for its inventory. BSG makes its adjustments at the end of each year All sales and inventory are purchased on account Be sure to round all numbers to the nearest dollar (Do Not Use Cents). The company had the following Post-Closing Trial Balance at 12/31/2022 Credit Debit 56,254 41,475 1,244 92,000 400 50 75,000 200,000 4,700 Account Name Cash Accounts Receivable Allowance for Bad Debt Inventory Supplies on Hand Prepaid Insurance Land Building A/D- Building Equipment A/D - Equipment Accounts Payable Income Tax Payble Interest Payable Unearned Rent Dividend Payable Notes Payable Common Stock APIC - Common Stock Retained Earnings 230,000 32,867 23,200 23,023 6,808 600 10,000 170,000 100,000 200,000 122,737 BSG uses, the 200% double declining balance, Half Year, method to depreciate all 5, 7 & 10-year property BSG uses, the SL, mid-month basis to depreciate all real property Income tax rate is 35% The $230,000 of equipment has an expected life of 7 years and no salvage value The $200,000 building has an expected life of 39 years and no salvage value Inventory at 1/1/23 consists of: o Running Sneakers - 500 units at $120 each Aerobir Sneakers - 400 units at 580 each Northern bank - 120,000, 6% interest rate, Interest is paid on June 30th of each year, principal to be repaid on June 30, 2024 Stock Common Stock has a $1 par value, 500,000 shares authorized, 100,000 shares issued and outstanding at 12/31/2022 Preferred Stock has a $10 par value, 10%, 100,000 shares authorized, there were no shares issued or outstanding at 12/31/2022 The following transactions and events occurred in 2023. Date Transaction 1/1 Issued 10,000 share of $1 par common stock to investors at $10 per share 1/1 Paid monthly rent on computer equipment, $500 1/1 Issued 5,000 share of $10 par, 10% preferred stock to investors at $15 per share 1/1 The estimated useful life and salvage value for the building that was purchased in 2022 was changed. It is now estimated that the building has a remaining life (as of 1/1/2023) of 20 years and a salvage value of $5,000. 1/1 Purchased a building and land for $200,000. The building has a 25-year expected useful life and a $10,000 expected salvage value. The land is valued at $80,000 1/10 Purchased $250 of supplies for cash 1/15 Purchased inventory on account - 500 Running Sneakers for $121 each and 600 Aerobic for $82 each 1/15 Made a payment of $20,000 to pay off several Accounts Payable accounts 1/15 Paid the cash dividend declared in November 2022 1/31 Paid $3,300 for a 1-year insurance policy (effective 2/1/2023 1/31/2024) 2/1 BSG repurchased 1,000 shares of its own common stock to be held as treasury stock. The price paid was $12 per share 2/1 Paid the interest on the loan from Foley Bank (Remember some of the interest was accrued at 12/31/2022- your entry should include three accounts) 2/2 Paid for inventory purchased on 1/15 2/20 Sold Inventory on account (sold 100 Running Sneakers for $200 and 120 Aerobic Sneakers for $150) terms 2/10, net 30 3/2 Received notice that a customer from 2022 declared bankruptcy and will not be able to pay the remaining balance owed on their bill, $1,000 3/5 Sold Inventory on account (sold 200 Running Sneakers for $200 and 70 Aerobic Sneakers for $150) terms 2/10, net 30 3/10 Received payment for the 2/20 transaction 3/12 Received payment for merchandise sold on 3/5 3/15 Paid income taxes owed from the 2022 fiscal year. 4/2 Sold Inventory on account (sold 250 Running Sneakers for $200 and 200 Aerobic Sneakers for $150) terms 2/10, net 30 4/10 Received payment for merchandise sold on 4/2 4/30 Purchased inventory on account - 700 Running Sneakers for $123 each and 500 Aerobic for $84 each Sold Inventory on account (sold 350 Running Sneakers for $200 and 250 Aerobic Sneakers for $150) terms 2/10, net 30 5/20 Customer from the 5/1 transaction returned inventory (50 Running Sneakers) all inventory was still in good working order 5/20 Customer paid their remaining balance from the 5/1 transaction 6/10 Paid for half of the inventory purchase from 4/30 5/1 Page 2 Date 7/1 7/1 7/15 8/2 8/10 9/10 Transaction Made interest payment on equipment note to Northern Bank Purchased $50,000 of equipment using a bank loan at 6% interest to be paid in 2 years. Interest is due on June 30 of each year. The equipment has a life of 7 years and a 5,000- salvage value Sold Inventory on account (sold 275 Running Sneakers for $200 and 315 Aerobic Sneakers for $150) terms 2/10, net 30 Purchased $300 of supplies for cash Received of payment from the 7/15 transaction Purchased inventory on account - 400 Running Sneakers for $124 each and 300 Aerobic for $85 each Made a payment of $100,000 towards our accounts payable balance, Purchased $350 of supplies for cash Received $4,200 from a tenant for 6 months' rent (11/1/2023 to 4/30/2024) Paid a cash dividend of $.20 per share on outstanding shares and paid dividends to preferred shareholders Sold Inventory on account (sold 600 Running Sneakers for $200 and 510 Aerobic Sneakers for $150) terms 2/10, net 30 Received payments totaling $250,000 from customers for past due invoices 10/1 10/15 11/1 11/17 12/1 12/31 Other Information: At year end $150 worth of supplies are on hand The company uses the % of Receivables method in estimating bad debts; 3% of the ending receivables balance is deemed to be uncollectible Required: Prepare all journal entries to record the information for 2023. Prepare all adjusting journal entries as necessary Prepare an adjusted Trial Balance as of December 31, 2023 Prepare an income statement, statement of retained earnings and a balance sheet as of December 31, 2023 Prepare a cash flow statement, using the indirect method, for the year ended December 31, 2023 Close all accounts as necessary and prepare a post-closing Trial Balance Please include a sheet on how you calculated your adjusting Journal entries and inventory Prepare a horizontal analysis of the balance sheet When preparing this analysis only analyze the sum of the main categories (total current assets, total long-term assets, total assets, total current liabilities, total long-term liabilities, total liabilities, total equity, total liabilities and equity) Prepare a vertical analysis for 2023 income statement o When preparing this analysis use the following categories: Net Sales, Cost of Goods Sold, Gross Profit, Operating Expenses, Income from Operations Other Expenses and losses, Income before income taxes, Income Tax Expense and Net Income Compute the following ratios for the company (use 365 days per year and be sure to show all calculations) Gross Profit Margin o Debt to assets ratio Net Profit Margin O Current ratio o Earnings per Share o Inventory Turnover o Return on Comm Stockholder's Days in Inventory equity Average receivable turnover o Return on Assets Average collection period Page 3 .80 Based on the following industry standards, comment on the profitability, solvency and liquidity of the company o Gross Profit Margin 40.00% o Net Profit Margin 15.20% o Earnings per Share o Return on Comm Stockholder's equity 17.00% Return on Assets 11.00% o Debt to assets ratio .50 o Current ratio 1.50 o Inventory Turnover 4.00 o Days in Inventory 91.25 o Average receivable turnover 15.00 o Average collection period 24.33 o NOTE: It is up to you to use the skills you learned in Spreadsheets to complete a report using Excel. Please be sure all cells are referenced and using formulas where applicable. Getting or using a template from another source is considered plagiarism and will result in automatically failing this assignment