Question: Liang Company began operations on January 1 2014 During its

Liang Company began operations on January 1, 2014. 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:
2014
a. Sold $1,345,434 of merchandise (that had cost $975,000) on credit, terms ny30.
b. Wrote off $18,300 of uncollectible accounts receivable.
c. Received $669,200 cash in payment of accounts receivable.
d. In adjusting the accounts on December 31, the company estimated that 1.5% of accounts receivable will be uncollectible.
2015
e. Sold $1,525,634 of merchandise (that had cost $1,250,000) on credit, terms ny30.
f. Wrote off $27,800 of uncollectible accounts receivable.
g. Received $1,204,600 cash in payment of accounts receivable.
h. In adjusting the accounts on December 31, the company estimated that 1.5% of accounts receivable will be uncollectible.
Required
Prepare journal entries to record Liang’s 2014 and 2015 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 amounts to the nearest dollar.)

View Solution:


Sale on SolutionInn
Sales9
Views727
Comments
  • CreatedApril 23, 2015
  • Files Included
Post your question
5000