Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Liang Company began operations on January 1, 2016. During its first two years, the company completed a number of transactions involving sales on credit, accounts
Liang Company began operations on January 1, 2016. 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. 2016 a. Sold $1,345,200 of merchandise (that had cost $982,900) on credit, terms n/30. b. Wrote off $18,400 of uncollectible accounts receivable c. Received $674,200 cash in payment of accounts receivable. d. In adjusting the accounts on December 31, the company estimated that 1.70% of accounts receivable will be uncollectible. 2017 e. Sold $1,502,700 of merchandise (that had cost $1,303,300) on credit, terms n/30 f. Wrote off $33,700 of uncollectible accounts receivable g. Received $1,395,200 cash in payment of accounts receivable h, in adjusting the accounts on December 31, the company estimated that 1.70% of accounts receivable will be uncollectible. Required: Prepare journal entries to record Liang's 2016 and 2017 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 amount.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started