1 Prepare journal entries to take into account the following
1. Prepare journal entries to take into account the following events and transactions.
a. In January 2015, the Wildlife Preservation Society received a grant from the Westwood Foundation of $6 million to be paid in three annual installments of $2 million starting on December 31, 2015.
The grant may be used for any legitimate activity engaged in by the Society. The Society applies a discount rate of 6 percent to long-term receivables.
b. Duringtheyearitalsoreceived$1millioninpledges from numerous individuals. The pledges must be used to support the Society's educational programs.
The Society expects that 5 percent will be uncollectible. The balance will be fulfilled within several months of year-end.
c. It collects $900,000 of the pledges and writes off $25,000 as uncollectible.
d. The Society receives its three annual payments of $2 million from the Foundation.
2. Suppose instead that the Society received numerous grants that are spread over a period of several years and thereby has a basis for establishing an allowance for uncollectible grants. Would an interest rate of the same 6 percent still be appropriate for taking into account the time value of money? Explain.

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