Problem 5-2A (Algo) Record transactions related to credit sales and contra revenues (LO5-1, 5-2) Adventure Fishing provides guided fishing tours. The company charges $230 per person but offers a 10% discount to parties of four or more. Consider the following transactions during the month of May. May 2 May 7 May 9 Charlene books a fishing tour with Adventure Fishing for herself and four friends at the group discount price ($1,035 $207 x 5). The tour is scheduled for May 7. The fishing tour occurs. Adventure Fishing asks that payment be made within 30 days of the tour and offers a 5% discount for payment within 15 days. Charlene is upset that no one caught a single fish and asks management for a discount. Adventure Fishing has a strict policy of no discounts related to number of fish caught. May 15 Upon deeper investigation, management of Adventure Fishing discovers that Charlene's tour was led by a new guide who did not take the group to some of the better fishing spots. In concession, management offers a sales allowance of 40% of the amount due. May 20 Adventure Fishing receives the amount owed by Charlene. Required: 1. Record the necessary transaction(s) for Adventure Fishing on each date. 2. Show how Adventure Fishing would present net revenues in its income statement. Problem 5-4A (Algo) Record transactions related to uncollectible accounts (LO5-4, 5-5) Pearl E. White Orthodontist specializes in correcting misaligned teeth. During 2024, Pearl provides services on account of $587,000. Of this amount, $77,000 remains receivable at the end of the year. An aging schedule as of December 31, 2024, is provided below. Estimated Percent Age Group Not yet due to 90 days past due 91 to 180 days past Amount Receivable Uncollectible $37,000 4% 15,700 20% 10,700 25% due More than 180 days 13,600 80% past due Total $77,000 Required: 1. Calculate the allowance for uncollectible accounts. 2. Record the December 31, 2024, adjusting entry, assuming the balance of Allowance for Uncollectible Accounts before adjustment is $4,700 (credit). 3. On July 19, 2025, a customer's account balance of $7,700 is written off as uncollectible. Record the write-off. 4. On September 30, 2025, the customer whose account was written off in requirement 3 unexpectedly pays the full amount. Record the cash collection. Problem 5-6A (Algo) Using estimates of uncollectible accounts to overstate income (LO5-5) Willie Cheetum is the CEO of Happy Foods, a distributor of produce to grocery store chains throughout the Midwest. At the end of the year, the company's accounting manager provides Willie with the following information, before any adjustment. Accounts receivable Estimated percentage uncollectible Allowance for uncollectible accounts Operating income $ 910,000 9% $ 21,000 $ 241,000 (credit) Willie's compensation contract states that if the company generates operating income of at least $191,000, he will get a salary bonus early next year. Required: 1. Record the adjusting entry for uncollectible accounts using the accountant's estimate of 9% of accounts receivable. 2-a. After the adjusting entry is recorded in requirement 1, what is the revised amount of operating income? 2-b. Will Willie get his salary bonus? 3. Willie instructs the accountant to record the adjusting entry for uncollectible accounts using 6% rather than 9% of accounts receivable. Now will Willie get his salary bonus? 4. By how much would total assets and operating income be misstated using the 6% amount?