Gray Corporation controls its cash by depositing receipts on a daily basis and making all disbursements by cheque.After all the posting for the month of August 2020 was completed, the cash balance in the general ledger accountat the end of the month was $10,475. The bank statement for the month end received from the First National Bankshowed the balance to be $18,000. The following data are available for the purpose of reconciling these balances:a. Cash receipts collected on August 31 amounting to $3,000 have been placed in the night depository anddo not appear on the bank statement.b. Bank memos previously not available to the company are included with the bank statement. A memo foran NSF cheque, originally received as payment for an account receivable of $3,000, is included. A memofor bank charges of $75 for the NSF cheque is also included. Another memo advises the company that$2,000 Note Receivable has been collected by the bank, ($1,950 deposit and a bank charge of $50). Thisrepresents the net proceeds of a collection the bank had made on behalf of the company on a $2,000note receivable.Cheques written during the month but not included with the bank statement are no. 1200, $1,500; no.1223, $2,000; no. 1260, $950; no. 1294, $3,500.d. Cheque no. 1222 is returned with the bank statement. The cheque was made for $6,500, the correctamount owing for office expense. The cheque was recorded in the company records in the amount of$5,600.Cheques outstanding at the end of July included cheques no. 1114 for $1,600 and no. 1116 for $1,250.Cheque no. 1116 cleared the August bank statement; cheque no. 1114 did not.C.е.Required:1. Prepare a bank reconciliation at August 31.Prepare the necessary adjusting journal entries required to make the cash account in the general ledgeragree with the adjusted cash balance on the July bank reconciliation.2.The Gray Corporation. has estimated its bad debts at 0.5 per cent of net credit sales. During 2018, Acme decided tocalculate the required balance for the allowance for doubtful accounts at year-end, December 31, by aging itsaccounts receivable and determined that 5% of accounts receivable is estimated not to be collected. The followingdata, which already have been recorded in the company's general ledger, are also available:20172018Accounts written offOn March 14, 2017 (Tosca)$1,500On March 30, 2018 (Capital)$6001 The Gray Corporation. has estimated its bad debts at 0.5 per cent of net credit sales. During 2018, Acme decided tocalculate the required balance for the allowance for doubtful accounts at year-end, December 31, by aging itsaccounts receivable and determined that 5% of accounts receivable is estimated not to be collected. The followingdata, which already have been recorded in the company's general ledger, are also available:20172018Accounts written offOn March 14, 2017 (Tosca)$1,500On March 30, 2018 (Capital)$600Recoveries of accounts written offOn June 5, 2018 (Tosca)200The Allowance for Doubtful Accounts general ledger account reported the January 1, 2017 to be $5,000 credit.Net credit sales for 2017 was $400,000. 2018 year-end balance for accounts receivable is $160,000Required: Prepare journal entries to record:1.The amount of bad debt expense for the year 2017i. 1(a) Show the calculation for bad debt expenseii. 1(b) Journal entry2.The bad debt expense on December 31, 2018i. 2(a) Show the calculation for bad debt expenseii. 2(b) Journal entry23.The collection from Tosca on June 5, 2018.

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