Question 1

Dell had net sales of $8,739 million and average accounts receivable of $864 million.Its accounts receivable turnover was:

Accepted Answer

A) 9.9. 
B) 10.1. 
C) 12.8. 
D) 36.1. 
E) 9.1. 
A) 9.9. 
B) 10.1. 
C) 12.8. 
D) 36.1. 
E) 9.1.

Question 2

Accounts receivable turnover shows how often a company converts its average accounts receivable balance into cash during the period.

Accepted Answer

A) True 
 B)False

Question 3

Assuming that Peter Corporation has a December 31 year-end, prepare the adjusting entry at December 31, 2018 for doubtful accounts.

Accepted Answer

.02 × $200

Question 4

What is the purpose of the days' sales uncollected ratio?

Accepted Answer

The days' sales uncollected ratio is a l

Question 5

Explain how the materiality principle can be used to justify the direct write-off method.

Accepted Answer

Materiality allows other principles to b

Question 6

If a 60-day note receivable is dated September 22, what is the due date of the note?

Accepted Answer

The answer of If a 60-day note receivable is dated...

Question 7

The days' sales uncollected ratio is calculated by dividing accounts receivable by net sales and multiplying the answer by 365.

Accepted Answer

A) True 
 B)False

Question 8

Selected financial statement data for California Ltd, at its December 31 year end is below:   California's credit terms are net 30 days. A 2% discount can be taken if the bill is paid within 10 days from the invoice date.In 2018, California collects its accounts receivable:

Accepted Answer

A) Within the 20 days, as required by its credit terms. 
B) Within the 30 days, as required by its credit terms. 
C) After the 30 day terms passed. 
D) Within the 10 day discount period. 
E) More information is needed to answer this question. 
A) Within the 20 days, as required by its credit terms. 
B) Within the 30 days, as required by its credit terms. 
C) After the 30 day terms passed. 
D) Within the 10 day discount period. 
E) More information is needed to answer this question.

Question 9

A company must have less than 30 days' sales uncollected in order to be adequately liquid.

Accepted Answer

A) True 
 B)False

Question 10

On December 31 of the current year, Kellan CompanyAbout 1.5% of credit sales.(b)About 5% of accounts receivable.

Accepted Answer

The answer of On December 31 of the current year,...

Question 11

The formula for computing interest on a note receivable is principal multiplied by interest rate multiplied by time.

Accepted Answer

A) True 
 B)False

Question 12

Assume that at March 14, 2019, it was determined that a balance of $7,000needed to be written off as uncollectible. Provide the journal entry for the write-off.

Accepted Answer

The answer of Assume that at March 14, 2019, it...

Question 13

Compaq's accounts receivable turnover rate was 5.7 for this year and 5.4 for last year.Dell's turnover rate was 6.8 for this year and 7 for last year. This means that:

Accepted Answer

A) Dell has the better turnover rate for both years. 
B) Dell's turnover rate is improving. 
C) Compaq has the better turnover rate for both years. 
D) Compaq's turnover rate is improving. 
E) Dell has the better turnover rate for both years and Compaq's turnover rate is improving. 
A) Dell has the better turnover rate for both years. 
B) Dell's turnover rate is improving. 
C) Compaq has the better turnover rate for both years. 
D) Compaq's turnover rate is improving. 
E) Dell has the better turnover rate for both years and Compaq's turnover rate is improving.

Question 14

Describe accounts receivable and how they are recorded into the accounting system.

Accepted Answer

Accounts receivable arise from sales to

Question 15

Electron borrowed $75,000 from TechCom by signing a promissory note and pledging$85,000 in accounts receivable as security. TechCom's entry to record the transaction should include a:

Accepted Answer

A) Credit to Notes Receivable for $75,000. 
B) Credit to Sales for $75,000. 
C) Debit Notes Payable for $75,000. 
D) Debit to Accounts Receivable for $75,000. 
E) Debit to Notes Receivable for $75,000. 
A) Credit to Notes Receivable for $75,000. 
B) Credit to Sales for $75,000. 
C) Debit Notes Payable for $75,000. 
D) Debit to Accounts Receivable for $75,000. 
E) Debit to Notes Receivable for $75,000.

Question 16

Interest on $8,400 at 7% for 60 days is:

Accepted Answer

A) $65.25. 
B) $96.66. 
C) $52.65. 
D) $36.45 
E) $41.42 
A) $65.25. 
B) $96.66. 
C) $52.65. 
D) $36.45 
E) $41.42

Question 17

Accounts receivable turnover is calculated by:

Accepted Answer

A) Dividing net income by average accounts receivable. 
B) Dividing average accounts receivable by net sales and multiplying by 365. 
C) Dividing net sales by average accounts receivable. 
D) Dividing net sales by average accounts receivable and multiplying by 365. 
E) Dividing average accounts receivable by net sales. 
A) Dividing net income by average accounts receivable. 
B) Dividing average accounts receivable by net sales and multiplying by 365. 
C) Dividing net sales by average accounts receivable. 
D) Dividing net sales by average accounts receivable and multiplying by 365. 
E) Dividing average accounts receivable by net sales.

Question 18

The days' sales uncollected ratio:

Accepted Answer

A) Is calculated by dividing accounts receivable by sales. 
B) Is used to evaluate the liquidity of receivables. 
C) Measures a company's debt to income. 
D) Measures a company's ability to pay its bills on time. 
E) Is calculated by dividing sales by accounts receivable. 
A) Is calculated by dividing accounts receivable by sales. 
B) Is used to evaluate the liquidity of receivables. 
C) Measures a company's debt to income. 
D) Measures a company's ability to pay its bills on time. 
E) Is calculated by dividing sales by accounts receivable.

Question 19

A payee of a note usually honours a note and pays it in full.

Accepted Answer

A) True 
 B)False

Question 20

Accounts receivable turnover is calculated by dividing net sales by average accounts receivable.

Accepted Answer

A) True 
 B)False

Dell had net sales of $8,739 million and average accounts receivable of $864 million.Its accounts receivable turnover was:

Accounts receivable turnover shows how often a company converts its average accounts receivable balance into cash during the period.

Assuming that Peter Corporation has a December 31 year-end, prepare the adjusting entry at December 31, 2018 for doubtful accounts.

What is the purpose of the days' sales uncollected ratio?

Explain how the materiality principle can be used to justify the direct write-off method.

If a 60-day note receivable is dated September 22, what is the due date of the note?

The days' sales uncollected ratio is calculated by dividing accounts receivable by net sales and multiplying the answer by 365.

Selected financial statement data for California Ltd, at its December 31 year end is below: California's credit terms are net 30 days. A 2% discount can be taken if the bill is paid within 10 days from the invoice date.In 2018, California collects its accounts receivable:

A company must have less than 30 days' sales uncollected in order to be adequately liquid.

On December 31 of the current year, Kellan CompanyAbout 1.5% of credit sales.(b)About 5% of accounts receivable.

The formula for computing interest on a note receivable is principal multiplied by interest rate multiplied by time.

Assume that at March 14, 2019, it was determined that a balance of $7,000needed to be written off as uncollectible. Provide the journal entry for the write-off.

Compaq's accounts receivable turnover rate was 5.7 for this year and 5.4 for last year.Dell's turnover rate was 6.8 for this year and 7 for last year. This means that:

Describe accounts receivable and how they are recorded into the accounting system.

Electron borrowed $75,000 from TechCom by signing a promissory note and pledging$85,000 in accounts receivable as security. TechCom's entry to record the transaction should include a:

Interest on $8,400 at 7% for 60 days is:

Accounts receivable turnover is calculated by:

The days' sales uncollected ratio:

A payee of a note usually honours a note and pays it in full.

Accounts receivable turnover is calculated by dividing net sales by average accounts receivable.

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts for Financial Statements

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Appendix

Filters

Exam 8: Receivables

Dell had net sales of $8,739 million and average accounts receivable of $864 million.Its accounts receivable turnover was:

Accounts receivable turnover shows how often a company converts its average accounts receivable balance into cash during the period.

Assuming that Peter Corporation has a December 31 year-end, prepare the adjusting entry at December 31, 2018 for doubtful accounts.

What is the purpose of the days' sales uncollected ratio?

Explain how the materiality principle can be used to justify the direct write-off method.

If a 60-day note receivable is dated September 22, what is the due date of the note?

The days' sales uncollected ratio is calculated by dividing accounts receivable by net sales and multiplying the answer by 365.

Selected financial statement data for California Ltd, at its December 31 year end is below: California's credit terms are net 30 days. A 2% discount can be taken if the bill is paid within 10 days from the invoice date.In 2018, California collects its accounts receivable:

A company must have less than 30 days' sales uncollected in order to be adequately liquid.

On December 31 of the current year, Kellan CompanyAbout 1.5% of credit sales.(b)About 5% of accounts receivable.

The formula for computing interest on a note receivable is principal multiplied by interest rate multiplied by time.

Assume that at March 14, 2019, it was determined that a balance of $7,000needed to be written off as uncollectible. Provide the journal entry for the write-off.

Compaq's accounts receivable turnover rate was 5.7 for this year and 5.4 for last year.Dell's turnover rate was 6.8 for this year and 7 for last year. This means that:

Describe accounts receivable and how they are recorded into the accounting system.

Electron borrowed $75,000 from TechCom by signing a promissory note and pledging$85,000 in accounts receivable as security. TechCom's entry to record the transaction should include a:

Interest on $8,400 at 7% for 60 days is:

Accounts receivable turnover is calculated by:

The days' sales uncollected ratio:

A payee of a note usually honours a note and pays it in full.

Accounts receivable turnover is calculated by dividing net sales by average accounts receivable.

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts for Financial Statements

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Appendix

Filters