The following transactions affecting the accounts receivable of Wonderland Corporation took place during the year ended January 31, 2011:

Sales (cash and credit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $591,050

Cash received from credit customers, all of whom took advantage of the

discount feature of the corporation’s credit terms 4/10, n/30 . . . . . . . . . . . . . . . . . . 303,800

Cash received from cash customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 210,270

Accounts receivable written off as worthless . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,250

Credit memoranda issued to credit customers for sales returns and allowances . . 63,800

Cash refunds given to cash customers for sales returns and allowances . . . . . . . . 13,318

Recoveries on accounts receivable written off as uncollectible in prior periods

(not included in cash amount stated above) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,290

The following two balances were taken from the January 31, 2010, balance sheet.

Accounts Receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $95,842

Allowance for Bad Debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,740 (credit)

The corporation provides for its net uncollectible account losses by crediting Allowance for Bad Debts for 1.5% of net credit sales for the fiscal period.

Instructions:

1. Prepare the journal entries to record the transactions for the year ended January 31, 2011.

2. Prepare the adjusting journal entry for estimated uncollectible accounts on January 31, 2011.