Cadux Candy Company's income statement for the year ended December 31, 2021, reported interest expense of $18 million and income tax expense of $62 million. Current assets listed in its balance sheet include cash, accounts receivable, and inventory.
Property, plant, and equipment is the company's only noncurrent asset. Financial ratios for 2021 are listed below. Profitability and
turnover ratios with balance sheet items in the denominator were calculated using year-end balances rather than averages.

The manda panda company uses the allowance method to account for bad debts. at the beginning of 2018, the allowance account had a credit balance of $92,400. credit sales for 2018 totaled $3,190,000 and the year-end accounts receivable balance was $507,500. during this year, $88,500 in receivables were determined to be uncollectible. manda panda anticipates that 3% of all credit sales will ultimately become uncollectible. the fiscal year ends on december 31. required: 1. does this situation describe a loss contingency? 2. what is the bad debt expense that manda panda should report in its 2018 income statement? 3. prepare the appropriate journal entry to record the contingency. 4. complete the table below to calculate the net realizable value manda panda should report in its 2018 balance sheet?