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Question: Liang Company began operations on January 1,2016. During its first two years, the...

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Accounting

Question:
Liang Company began operations on January 1,2016. 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:
2016:
a. Sold $1,349,400 of merchandise (that had cost $975,100) on credit, terms n/30.
b. Wrote off $20,800 of uncollectible accounts receivable.
c. Received $669,100 cash in payment of accounts receivable.
d. In adjusting the accounts on December 31, the company estimated that 1.70% of accounts
receivable will be uncollectible.
2017:
e. Sold $1,585,600 of merchandise (that had cost $1,322,700) on credit, terms n30.
f. Wrote off $30,400 of uncollectible accounts receivable.
g. Received $1130.000 cash in payment of accounts receivable.
h. In adjusting the accounts on December 31, the company estimated that 170% of accounts
receivable will be uncollectible.
Required:
Prepare journal entries to record Liang's 2016 and 2017 summarized transactions and its
year-end adjustments to record bad debts expenses. (The company uses the perpetual
inventory system and it applies the allowance method for its accounts receivable).
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