20. ABC Company uses the perpetual inventory system and all purchases and sales are on credit. The company uses the allowance method to account for bad debt. The following transactions occurred during January of 2021: 1/4/21 Sold $800 of merchandise that cost $525 to XYZ Co, terms n/15. 1/5/21 Sold $6,900 of merchandise, that had a cost of 4,100 to customers who used a credit card. The credit card company charges ABC a 3% processing fee. 1/13/21 Wrote off an accounts receivable from a sale made in the prior year in the amount of $650. 1/18/21 Received a check in full payment for the sale made on 1/4/21 to XYZ Co. Using the attached T-account template (or prepare an "equation" presentation): Prepare the entries to recognize the transactions listed above