a. 5. The matching rule, applied under the allowance method, relates to losses from credit sales by stating that Bad Debt Expense should be recorded: in the period of the sale. b. in the period of the loss. c. for an exact amount. d. in the same period as allowed for tax purposes. 6. Suppose that Microsoft sells $4,000,000 of its Xbox 360 game to a Micro Center. Micro Center signs a promissory note that has the following terms: annual interest rate of 5% and principal plus interest due in 3 months. Assuming that Micro Center repays the entire amount as scheduled after 3 months, what is the Maturity Value of this note receivable? $4,000,000 b. $4,050,000 c. $4,200,000 d. $4,600,000 7. A $10,000, 90-day, 4% note was received on May 4 and that the fiscal year ended on May 31. Interest will be paid by the borrower on the maturity date of the note. The adjusting entry to record the accrued interest revenue as of May 31 would be (amounts rounded to nearest dollar, use 360-day year): Debit Interest Receivable 30; Credit Interest Revenue 30 b. Debit Cash 100; Credit Interest Revenue 100 c. Debit Interest Receivable 120; Credit Interest Revenue 120 d. Debit Interest Revenue 120; Credit Interest Revenue 120 a