Liang Company began operations on January 1, 2016. During its first two years, t
ID: 2555423 • Letter: L
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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.
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 $1,352,700 of merchandise (that had cost $975,200) on credit, terms n/30 b. Wrote off $21,500 of uncollectible accounts receivable c. Received $668,700 cash in payment of accounts receivable d. In adjusting the accounts on December 31, the company estimated that 2.40% of accounts receivable will be uncollectible 17/20 points awarded Scored 2017 e. Sold $1,549,100 of merchandise (that had cost $1,346,500) on credit, terms n/30. f. Wrote off $28,700 of uncollectible accounts receivable g. Received $1,231,700 cash in payment of accounts receivable h. In adjusting the accounts on December 31, the company estimated that 2.40% 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 expense. (The company uses the perpetual inventory system and it applies the allowance method for its accounts receivable.) (Round your intermediate calculations to the nearest dollar amount.) Complete this question by entering your answers in the tabs below JE 2016 E 2017 Prepare journal entries to record Liang's 2016 summarized transactions and its year-end adjustments to record bad debts expense. (The company uses the perpetual inventory system and it applies the allowance method for its accounts receivable.) No Transaction General Journal Debit Credit Accounts receivable 1,352,700 Sales 1,352,700 Cost of good sold 975,200 Merchandise inventory 975.200 Bad debts expense 21,500 Accounts receivable 21,500 668,700 C. Accounts receivable 668,700 Bad debts expense 69,498 Accounts receivable 69,498Explanation / Answer
JOURNAL ENTRIES: S.NO. ACCOUNTS TITLE AND EXPLANATIONS DEBIT $ CREDIT $ a. Accounts receivable Dr. 1352700 Sales revenue 1352700 Cost of Goods sold Dr. 975200 Inventory 975200 b. Allowance for doubtful accounts dr. 21500 Accounts receivable 21500 c. Cash Account Dr. 668700 Accounts recceivable 668700 d. Bad debts expense Dr. 37400 Allowance for doubtful accounts 37400 e. Accounts receivable Dr. 1549100 Sales revenue 1549100 Cost of Goods sold Dr. 1346500 Inventory 1346500 f. Allowance for doubtful accounts dr. 28700 Accounts receivable 28700 g Cash Account Dr. 1231700 Accounts recceivable 1231700 h. Bad debts expense Dr. 35629 Allowance fro doubtful accounts 35629 Note: balance in Accounts receivable: Sales during the year 1352700 Less: Uncollectible -21500 Less: cash reeived -668700 Ending balance of AR 662500 Allowance balance required (@2.40%) 15900 Add: Uncollectibles accounts 21500 Bad debts expense for 2016 37400 2017 Beginning balannce of AR 662500 Add: Credit sales 1549100 Less: Write off -28700 Less: cash received -1231700 Ending Balance of AR 951200 Allowance accounts balance required @2.4% 22829 Add: write off 28700 Less: Balance in the beginning -15900 Bad debts expense 35629
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