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Problem 7 - 4 A ( Algo ) Accounts receivable transactions and bad debts adjustments LO C 1 , P 2 , P 3 Liang

Problem 7-4A (Algo) Accounts receivable transactions and bad debts adjustments LO C1, P2, P3
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 $1,352,200 of merchandise on credit (that had cost $978,100), terms n/30.
Wrote off $19,400 of uncollectible accounts receivable.
Received $670,500 cash in payment of accounts receivable.
In adjusting the accounts on December 31, the company estimated that 2.70% of accounts receivable would be uncollectible.
Year 2
Sold $1,563,200 of merchandise (that had cost $1,311,900) on credit, terms n/30.
Wrote off $31,200 of uncollectible accounts receivable.
Received $1,181,400 cash in payment of accounts receivable.
In adjusting the accounts on December 31, the company estimated that 2.70% 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.)
Note: Round your intermediate calculations to the nearest dollar.
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