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The Statement of Financial Position as at 31 December 2019 for Karisma Bhd is presented below. Karisma Bhd Statement of Financial Position as at 31 December 2019 RM RM RM Equipment 108,000 Share Capital - Ordinary 100,000 Less: Accumulated 21,600 86,400 Share Premium 30,000 depreciation Accounts Receivable 68,800 Retained Earnings 51,654 Less: Allowance for 8,256 60,544 Bond Payable 50,000 doubtful debts Prepaid Insurance 36,000 Accounts Payable 32,540 Inventory 61,860 Dividend Payable 15,000 Cash 46,390 Unearned Rent 12,000 Total 291,194 Total 291,194 The following selected transactions of Karisma Bhd occur in 2020: No. Transactions 1. Received RM37,800 cash from customers in payment of account 2. Purchased merchandise on account, RM44,980. 3. Sold merchandise on account RM67,340. 4. Paid RM38,120 on accounts payable. 5. Provided two-third (2/3) rent services for customers who had made payments in advance. 6. Paid dividends that are approved and declared in the annual general meeting to shareholders. 7. An aging schedule indicates that RM12,500 of accounts receivable will be uncollectible. Required: a) Prepare the journal entries for the above transactions that occur in 2020. b) Calculate the expected net realizable value of accounts receivable as at 31 December 2020. c) Briefly explain TWO (2) disadvantages of using the direct write-off method in accounting for uncollectible accounts as compared to the allowance method

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