Sumatra Inc. imports truffles and sells them to local restaurants. All sales are made on account with terms net $30.$ All purchases are for cash. Sumatra Inc. uses the perpetual inventory method and the average cost method. At the beginning of the year, Sumatra Inc. had the following account balances

$1.$ Accounts receivable balance of $$2,000$ and an allowance for doubtful accounts of $$400.$ All the amounts were owed from A Ltd$.$

$2.$ Opening inventory of $200$ units at $$40$ per unit.

The company had the following transactions during $2023$:

Date

Feb. $1$ Purchase $300$ units at $$50$ per unit for cash.

Mar $1$ Received $$1,500$ from A Ltd$.$ Wrote off the remaining balance as uncollectible.

May $1$ Sold $400$ units to B Ltd$.$ on account at $$100$ per unit.

May $9$ Collected the amount due from B Ltd$.$ for the sale on account on May. $1.$

Aug $1$ Purchased $300$ units at $$60$ per unit for cash.

Sep $20$ Sold $300$ units to C Ltd$.$ on account at $$90$ per unit.

Nov $1$ Purchased $200$ units at $$50$ per unit for cash.

Dec $8$ Sold $200$ units to D Ltd$.$ on account at $$110$ per unit.

At the end of the year Sumatra Inc. uses the aging method of estimating its uncollectible accounts. Sumatra Inc. estimates that the amount that will not be collectible is $10\%$ if the receivable is overdue more than $90$ days, $5\%$ if overdue equal to or less than $90$ days and $2\%$ if not yet due.

Required

$1.$ Prepare all necessary entries to record the transactions above and to record the appropriate allowance for doubtful accounts at year end.

$2.$ Calculate Sumatra Inc.$$s gross profit for the year. Round to two decimal places.