1. On January 31, 2021, KL Company wrote off an uncollectible account of $5,000. The allowance method is used. The write-off would cause bad debt expense to A. decrease by $5,000. B. increase by $5,000. C. increase by $10,000. D. not change.

2. A customer purchased a $2,000 item from Goldy Paper, paying with a credit card (VISA). Goldy Paper is charged a 2% fee by the credit card company. When recording this sale, Goldy Paper will: A. debit accounts receivable for $2,000. B. credit sales revenue for $2,000. C. credit sales revenue for $1,800. D. credit unearned sales revenue for $2,0.

From Question 2 write out the journal entry in good form for the above.

3. Show Your Work. A customer purchased a $2,000 item at ApplianceWorld, paying with a credit card (VISA). The merchant is charged a 2% fee by the credit card company. When recording this sale, the merchant would: ___A. debit accounts receivable for $2,000. ___B. credit sales revenue for $2,000. ___C. credit sales revenue for $1,800. ___D. credit unearned sales revenue for $2,000.

4. Big Ten Magazine received cash subscriptions on August 1, 2021 in the amount of $3,600 for the next three years. Their year-end is December 31, 2021. Magazine delivery occurs monthly and started on August 1, 2021. These were the only subscription sales for the year. Answer the following questions for the year ended December 31, 2021. a. What is the original journal entry on August 1, 2021? b. What is the adjusting journal entry on December 31, 2021?

c. What amount of subscriptions revenue should be reported on the income statement?

d. What amount would be reported as unearned subscriptions revenue on the balance sheet as of December 31, 2021