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 $1,348,700 of merchandise on credit (that had cost $977,000), terms n 30 Wrote off $19,700 of uncollectible accounts receivable Received $667,100 cash in payment of accounts receivable In adjusting the accounts on December 31, the company estimated that 1 20 of accounts receivable would be uncollectible Year 2 Sold $1,539,500 of merchandise (that had cost $1,278,400) on credit, terms n 30 Wrote off $28,300 of uncollectible accounts receivable Received $1,271,700 cash in payment of accounts receivable In adjusting the accounts on December 31, the company estimated that 1 20 of accounts receivable would be uncollectible Required Prepare journal entries to record Liangs 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 ) (Round your intermediate calculations to the nearest dollar )

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Posted on Jul 13, 2024

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

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 $1,348,700 of merchandise on credit (that had cost $977,000), terms n/30.
Wrote off $19,700 of uncollectible accounts receivable.
Received $667,100 cash in payment of accounts receivable.
In adjusting the accounts on December 31, the company estimated that 1.20% of accounts receivable would be uncollectible.

Year 2

Sold $1,539,500 of merchandise (that had cost $1,278,400) on credit, terms n/30.
Wrote off $28,300 of uncollectible accounts receivable.
Received $1,271,700 cash in payment of accounts receivable.
In adjusting the accounts on December 31, the company estimated that 1.20% of accounts receivable would be uncollectible.

Required: Prepare journal entries to record Liangs 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.) (Round your intermediate calculations to the nearest dollar.)