The following trial balance was prepared for Tile, Etc., Incorporated, on December 31, Year 1, after the closing entries were posted. \table[[Account Title,Debit,Credit,],[Cash,
$110,000
,,],[Accounts receivable,125,000,,],[Allowance for doubtful accounts,425,000,
$18,000
,],[Inventory,,,95,000],[Accounts payable,,450,000,],[Common stock,,97,000,],[Retained earnings,
$660,000
,
$660,000
,]] Tile, Etc., had the following transactions in Year 2: Purchased merchandise on account for
$580,000
. Sold merchandise that cost
$420,000
for
$890,000
on account. Sold for
$245,000
cash merchandise that had cost
$160,000
. Sold merchandise for
$190,000
to credit card customers. The merchandise had cost
$96,000
. The credit card company charges a 4 percent fee. Collected
$620,000
cash from accounts receivable. Paid
$610,000
cash on accounts payable. Paid
$145,000
cash for selling and administrative expenses. Collected cash for the full amount due from the credit card company (see item 4). Loaned
$60,000
to J. Parks. The note had an 8 percent interest rate and a one-year term to maturity. Wrote off
$7,500
of accounts as uncollectible. Made the following adjusting entries: (a) Recorded uncollectible accounts expense estimated at 1 percent of sales on account. (b) Recorded seven months of accrued interest on the note at December 31, Year 2 (see item 9). Required a. Prepare general journal entries for these transactions, and post the entries to T-accounts. Also, prepare an income statement, a statement of changes in stockholders' equity, a balance sheet, and a statement of cash flows for Year 2. b. Compute the net realizable value of accounts receivable at December 31, Year 2. c. If Tile, Etc., used the direct write-off method, what amount of uncollectible accounts expense would it report on the income statement? Complete this question by entering your answers in the tabs below. I need the answer to A,B, and C ASAP