Pesto company possesses 80 percent of salerno company’s outstanding voting stock. pesto uses the initial value method to account for this investment. on january 1, 2010, pesto sold 6 percent bonds payable with a $16.5 million face value (maturing in 20 years) on the open market at a premium of $750,000. on january 1, 2013, salerno acquired 40 percent of these same bonds from an outside party at 96.6 percent of face value. both companies use the straightline method of amortization. for a 2014 consolidation, what adjustment should be made to pesto’s beginning retained earnings as a result of this bond acquisition?

Colorado rocky cookie company offers credit terms to its customers. at the end of 2018, accounts receivable totaled $715,000. the allowance method is used to account for uncollectible accounts. the allowance for uncollectible accounts had a credit balance of $50,000 at the beginning of 2018 and $30,000 in receivables were written off during the year as uncollectible. also, $3,000 in cash was received in december from a customer whose account previously had been written off. the company estimates bad debts by applying a percentage of 15% to accounts receivable at the end of the year. 1. prepare journal entries to record the write-off of receivables, the collection of $3,000 for previously written off receivables, and the year-end adjusting entry for bad debt expense.2. how would accounts receivable be shown in the 2018 year-end balance sheet?