The net accounts receivable on the books of GJY corporation as of January 1,2013 are as follows:

Account receivable	$562,000
Less: Allowance for sales discounts	($12,000)
Allowance for doubtful accounts	($41,300)
Net account receivable	$508,700

During the year, the sales discount allowance is left unchanged with discounts recorded directly in the sales discounts account. Allowances are adjusted at year-end. Summarized transactions during 2013 are as follows::

a) Sales revenue was $1,240,000 of which 70% was on credit.

b) Customers paid off $985,000 of the outstanding account receivable. Of this reduction to the account receivable, $600,000 was paid in time to earn a 2% discount.

c) Accounts of $15,300 were written off at year-end.

d) There were recoveries of previously written-off accounts in the amount of $2,800.

e) At year-end, analysis of account receivable indicates that an allowance of $7,900 is needed for sales discounts.

f) At year-end, the allowance for doubtful accounts is increased by 1% of gross credit sales.

Required:

1) Prepare journal entries for the above transactions.

2) Show how the net accounts receivable appear on the statement of financial position on December 31,2013.

3) Do you have any concerns about the level of the allowance for doubtful accounts? Explain.