Reference no: EM131533723

Question: Crist Co. began operations on January 1, 2010, and completed several transactions during 2010 and 2011 that involved sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows.
2010

a. Sold $673,490 of merchandise (that had cost $500,000) on credit, terms n/30.

b. Received $437,250 cash in payment of accounts receivable.

c. Wrote off $8,330 of uncollectible accounts receivable.

d. In adjusting the accounts on December 31, the company estimated that 1% of accounts receivable will be uncollectible.
2011

e. Sold $930,100 of merchandise (that had cost $650,000) on credit, terms n/30.

f. Received $890,220 cash in payment of accounts receivable.

g. Wrote off $10,090 of uncollectible accounts receivable.

h. In adjusting the accounts on December 31, the company estimated that 1% of accounts receivable will be uncollectible.

Required: Prepare journal entries to record Crist's 2010 and 2011 summarized transactions and its year-end adjusting entry to record bad debts expense. (The company uses the perpetual inventory system. Round amounts to the nearest dollar.)