Problem 7-4A 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 a. Sold $1,350,000 of merchandise (that had cost $984,400) on credit, terms n/30. b. Wrote off $18,800 of uncollectible accounts receivable. c. Received $667,000 cash in payment of accounts receivable. d. In adjusting the accounts on December 31, the company estimated that 2.10% of accounts receivable would be uncollectible. Year 2 e. Sold $1,511,500 of merchandise (that had cost $1,331,500) on credit, terms n/30. f. Wrote off $27,500 of uncollectible accounts receivable. g. Received $1,223,200 cash in payment of accounts receivable. h. In adjusting the accounts on December 31, the company estimated that 2.10% of accounts receivable would be uncollectible. Required: Prepare journal entries to record Liang's 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.) Journal entry worksheet 1 2 3 4 5 Sold $1,511,500 of merchandise on credit, terms n/30. Note: Enter debits before credits. Transaction General Journal Credit Debit e(1) Record entry Clear entry View general journal Journal entry worksheet 1 2 4 5 Record cost of goods sold, $1,331,500. Note: Enter debits before credits Transaction General Journal Credit Debit e(2) Record entry Clear entry View general journal Journal entry worksheet 1 2 4 5 Wrote off $27,500 of uncollectible accounts receivable. Note: Enter debits before cred its. General Journal Credit Transaction Debit f. Record entry Clear entry View general journal Journal entry worksheet 1 2 4 5 Received $1,223,200 cash in payment of accounts receivable. Note: Enter debits before credits Transaction General Journal Credit Debit Record entry Clear entry View general journal LO Journal entry worksheet 1 2 3 4 5 In adjusting the accounts on December 31, the company estimated that 2.10% of accounts receivable would be uncollectible Note: Enter debits before credits Transaction General Journal Credit Debit h. Record entry Clear entry View general journal LO