L06-4,6-5 APG-7 Recording Receivables Transactions Reporting Accounts Receivable, and interpreting Ratios (PG-7) Rodamex Inc. reported the following summer transactions during the year ended December 31, 2018. a. Sold merchandise for $5,000,000, including $500,000 cash and $4,500,000 on account, with terms net 30 b. Sales returns and allowances, 850,000, 10 percent related to cash sales, and 90 percent related to sales on account c. Received 84,200,000 from customers on credit sales. d. Wrote off $17,000 in uncollectible accounts receivable. c. Recovered $6,000 cash from a customer whose account was previously written off. Rodamex estimated that doubtful accounts receivable represented 2 percent of the accounts receivable balance at December 31, 2017, and 2.5 percent at December 31, 2018. The company had $700,000 in accounts receivable at December 31, 2017. Required: 1. Prepare journal entries to record the summary transactions 2. Show how accounts receivable would be presented on the company's comparative statement of financial position as at December 31, 2018 3. Prepare the adjusting journal entry to record bad debt expense for 2018. 4. Compute the receivables turnover ratio for 2018. What does the result suggest about the companys ability to manage accounts receivable during 2018? 5. Compute the gross profit for 2018 assuming that the companu's cost of sales averages 40 percom of its net sales. DS. Determinina Baby