Problem 9-4A 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 1

1. Sold $1,346,700 of merchandise (that had cost $979,900) on credit, terms n/30.
2. Wrote off $18,900 of uncollectible accounts receivable.
3. Received $672,400 cash in payment of accounts receivable.
4. In adjusting the accounts on December 31, the company estimated that 2.40% of accounts receivable would be uncollectible.

Year 2

5. Sold $1,587,100 of merchandise (that had cost $1,276,500) on credit, terms n/30.
6. Wrote off $33,600 of uncollectible accounts receivable.
7. Received $1,252,300 cash in payment of accounts receivable.
8. In adjusting the accounts on December 31, the company estimated that 2.40% of accounts receivable would be uncollectible