1. On July 31, Electronics For You sold a 65 inch interactive LED television to a customer for $5,000. The television had a cost basis of $2,775. The customer is required to make a $500 down payment and to pay the $4,500 balance in equal $100 payments over the next 45 months on the last day of each month.Under the installment method of revenue recognition, how much gross profit will the company recognize during the current year?

$ 140.

$ 280.

$ 445.

$ 500.

2. Satin Bows Company uses the percentage of credit sales approach to estimate its expected credit losses. It estimates its losses at 1 percent of credit sales, which were $415,300 during the year. The Accounts Receivable balance was $12,500 and the Allowance for Uncollectible Accounts had an existing negative balance of $500 at year-end. (i.e., the bad debt expense had been under estimated in the prior period).What is the bad debt expense for the year?