Part 1: The December 31, 2021, balance sheet of the Pina Colada Corp. had Accounts Receivable of $700,000 and a credit balance in Allowance for Doubtful Accounts of $32,000. During 2022, the following transactions occurred: sales on account $1,572,000; sales returns and allowances, $191,000; collections from customers, $1,300,000; accounts written off, $40,000; previously written off accounts of $8,000 were collected. Journalize the 2022 transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Part 2: If the company uses the percentage of receivables basis to estimate bad debt expense and determines that uncollectible accounts are expected to be 6% of accounts receivable, what is the adjusting entry at December 31, 2022? (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
