[The following information applies to the questions displayed below.] On January 1, 2018, the general ledger of ACME Fireworks includes the following account balances:

During January 2018, the following transactions occur: January 2. Sold gift cards totaling $11,400. The cards are redeemable for merchandise within one year of the purchase date. January 6. Purchase additional inventory on account, $164,000. January 15. Firework sales for the first half of the month total $152,000. All of these sales are on account. The cost of the units sold is $82,300. January 23. Receive $127,100 from customers on accounts receivable. January 25. Pay $107,000 to inventory suppliers on accounts payable. January 28. Write off accounts receivable as uncollectible, $6,500. January 30. Firework sales for the second half of the month total $160,000. Sales include $11,000 for cash and $149,000 on account. The cost of the units sold is $88,000. January 31. Pay cash for monthly salaries, $53,700.

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1. Record each of the transactions listed above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

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**1. Depreciation on the equipment for the month of January is calculated using the straight-line method. At the time the equipment was purchased, the company estimated a residual value of $4,900 and a two-year service life. 2. At the end of January, $28,000 of accounts receivable are past due, and the company estimates that 30% of these accounts will not be collected. Of the remaining accounts receivable, the company estimates that 5% will not be collected. 3. Accrued interest expense on notes payable for January. 4. Accrued income taxes at the end of January are $14,700. 5. By the end of January, $4,700 of the gift cards sold on January 2 have been redeemed.** 2. Record the adjusting entries on January 31 for the above transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)