Furtastic manufactures imitation fur garments. On June 1, 2021, Furtastic made a sale to Willetts Department Store under terms that require Willett to pay $150,000 to Furtastic on June 30, 2021. In a separate transaction on June 15, 2021, Furtastic purchased brand advertising services from Willett for $12,000. The fair value of those advertising services is $5,000. Furtastic expects that 3% of all sales will prove uncollectible.

Required:

1. Prepare the journal entry to record Furtastics sale on June 1, 2021.

2. Prepare the journal entry to record Furtastics purchase of advertising services from Willett on June 15, 2021. Assume all of the advertising services are delivered on June 15, 2021.

3. Prepare the journal entry to record Furtastics receipt of $150,000 from Willett on June 30, 2021.

4. How would Furtastics expectation regarding uncollectible accounts affect its recognition of revenue from the sale to Willetts Department Store on June 1, 2021? Explain briefly.