The footnote in thefinancial statementsof The Welfare foundation contains the following note titled "Promises to Give":

Unconditional promises to give were as follows at December 31: (Refer to Chart that is attached as an image )

The discount rates used on long-term promises to give were 3 percent in 2020 and 2019.

1. Suppose that the foundation was to make a statement of financial position in columnar form, one column for unrestricted net assets, another for temporarily restricted net assets, and a third for permanently restricted net assets. In which column would these receivables be reported? Explain.

2. Suppose that on December 31, 2020, the foundation collected $ 500,000 of the $1, 098,384 due over a five-year period. Make the appropriate journal entries to record the collection of the $500,000 and to adjust the remaining balance in the receivables account. Be sure to recognize interest on the balance of the contributions due in over five years and one to five years (less the discount).

3. Another note to the statements indicates that the foundation has made grants to various other organizations.

Some of these are payable over a five-year period. Accordingly, it adjusted its grants payable account to take into account the time value of money and applied adiscount rateof 3 percent. However, per the note, the grants are classified as Level 3 in accordance with the fair value hierarchy and have been valued using an income approach. What are the different valuation techniques? What is level 3 classification? Explain this in simple words.

2020 2019 Contributions due in less than one year $2,293,775 2,305,753 Contributions due in one to five years $5,454,320 6,272, 198 Contributions due in more than five years $1,098,384 1,696,768 8,846,479 10,274,719 Less allowance for bad debts (166,972) (398,723) Less discount to net present value (497,812) (710,124) $8,181,695 $9,165,872