Question 1

Match the following definitions with their appropriate terms in the next 14 questions.
-Maturity date

Accepted Answer

A) A liability resulting from the signing of a promissory note. 
B) A measure of how long it takes to collect receivables. 
C) A written promise to repay a definite sum of money on demand or at a fixed or determinable date in the future. 
D) The length of time a note is outstanding, that is, the period of time between the date it is issued and the date it matures. 
E) The party that will receive the money from a promissory note at some future date.
F)The process of selling a promissory note.
G)The date the promissory note is due.
H)The amount of cash the maker is to pay the payee on the maturity date of the note.
I)The difference between the principal amount of the note and its maturity value.
J)An asset resulting from the acceptance of a promissory note from another company.
K)Securities issued by corporations and governmental bodies as a form of borrowing.
L)Securities issued by corporations as a form of ownership in the business.
M)The party that agrees to repay the money for a promissory note at some future date.
N)The amount of cash received, or the fair value of the products or services received, by the maker when a promissory note is issued. 
A) A liability resulting from the signing of a promissory note. 
B) A measure of how long it takes to collect receivables. 
C) A written promise to repay a definite sum of money on demand or at a fixed or determinable date in the future. 
D) The length of time a note is outstanding, that is, the period of time between the date it is issued and the date it matures. 
E) The party that will receive the money from a promissory note at some future date.
F)The process of selling a promissory note.
G)The date the promissory note is due.
H)The amount of cash the maker is to pay the payee on the maturity date of the note.
I)The difference between the principal amount of the note and its maturity value.
J)An asset resulting from the acceptance of a promissory note from another company.
K)Securities issued by corporations and governmental bodies as a form of borrowing.
L)Securities issued by corporations as a form of ownership in the business.
M)The party that agrees to repay the money for a promissory note at some future date.
N)The amount of cash received, or the fair value of the products or services received, by the maker when a promissory note is issued.

Question 2

Match the following definitions with their appropriate terms in the next 14 questions.
-Maturity value

Accepted Answer

A) A liability resulting from the signing of a promissory note. 
B) A measure of how long it takes to collect receivables. 
C) A written promise to repay a definite sum of money on demand or at a fixed or determinable date in the future. 
D) The length of time a note is outstanding, that is, the period of time between the date it is issued and the date it matures. 
E) The party that will receive the money from a promissory note at some future date.
F)The process of selling a promissory note.
G)The date the promissory note is due.
H)The amount of cash the maker is to pay the payee on the maturity date of the note.
I)The difference between the principal amount of the note and its maturity value.
J)An asset resulting from the acceptance of a promissory note from another company.
K)Securities issued by corporations and governmental bodies as a form of borrowing.
L)Securities issued by corporations as a form of ownership in the business.
M)The party that agrees to repay the money for a promissory note at some future date.
N)The amount of cash received, or the fair value of the products or services received, by the maker when a promissory note is issued. 
A) A liability resulting from the signing of a promissory note. 
B) A measure of how long it takes to collect receivables. 
C) A written promise to repay a definite sum of money on demand or at a fixed or determinable date in the future. 
D) The length of time a note is outstanding, that is, the period of time between the date it is issued and the date it matures. 
E) The party that will receive the money from a promissory note at some future date.
F)The process of selling a promissory note.
G)The date the promissory note is due.
H)The amount of cash the maker is to pay the payee on the maturity date of the note.
I)The difference between the principal amount of the note and its maturity value.
J)An asset resulting from the acceptance of a promissory note from another company.
K)Securities issued by corporations and governmental bodies as a form of borrowing.
L)Securities issued by corporations as a form of ownership in the business.
M)The party that agrees to repay the money for a promissory note at some future date.
N)The amount of cash received, or the fair value of the products or services received, by the maker when a promissory note is issued.

Question 3

Why do businesses invest in short-term investments?

Accepted Answer

A)  They are trying to gain control over the activities of other companies. 
B)  They are investing excess cash to meet future business operation or investment needs. 
C)  They are lending money to companies that cannot obtain bank loans. 
D)  More than one of the above is correct. 
A)  They are trying to gain control over the activities of other companies. 
B)  They are investing excess cash to meet future business operation or investment needs. 
C)  They are lending money to companies that cannot obtain bank loans. 
D)  More than one of the above is correct.

Question 4

The alternate term for a credit card draft is an invoice.

Accepted Answer

A) True 
 B)False

Question 5

Both stock and bond investments have maturity dates.

Accepted Answer

A) True 
 B)False

Question 6

Rafter.com received a 10%, 90-day promissory note with a face amount of $12,000 from Joyce Company, for the sale of merchandise on November 1, 2014.
A Identify the maturity date of the note.
B How much interest income to the nearest whole month will Rafter.com earn over the term of the note?
C How much interest income will Rafter.com recognize during 2014?

Accepted Answer

A January 30, 2015
B

Question 7

Why does the discounting of a note receivable with recourse result in a contingent liability? Should the liability be reported on the balance sheet? Explain.

Accepted Answer

When a note receivable is discounted wit

Question 8

How will the payee of the promissory note record the note on its books?

Accepted Answer

A)  The promissory note will be recorded as an asset 
B)  The promissory note will be recorded as a liability 
C)  The promissory note will be recorded as revenue 
D)  The promissory note will be recorded as an expense 
A)  The promissory note will be recorded as an asset 
B)  The promissory note will be recorded as a liability 
C)  The promissory note will be recorded as revenue 
D)  The promissory note will be recorded as an expense

Question 9

Refer to the data for Slammer Sports.
If the aging approach is used to estimate bad debts, how much is the net realizable value of the accounts receivable at December 31, 2014?

Accepted Answer

$175,000 Accounts Re

Question 10

Match the following definitions with their appropriate terms in the next eight questions.
-Allowance method

Accepted Answer

A) A receivable arising from the sale of goods or services with a verbal promise to pay. 
B) A form used to categorize the various individual accounts receivable according to the length of time each has been outstanding. 
C) A method of estimating bad debts on the basis of either the net credit sales of the period or the accounts receivable at the end of the period. 
D) A measure of the number of times receivables are collected in a period. 
E) The general ledger account that is supported by a subsidiary ledger.
F)A contra-asset account used to reduce accounts receivable to its net realizable value.
G)The detail for a number of individual items that collectively make up a single general ledger account.
H)The recognition of bad debts expense at the point an account is written off as uncollectible. 
A) A receivable arising from the sale of goods or services with a verbal promise to pay. 
B) A form used to categorize the various individual accounts receivable according to the length of time each has been outstanding. 
C) A method of estimating bad debts on the basis of either the net credit sales of the period or the accounts receivable at the end of the period. 
D) A measure of the number of times receivables are collected in a period. 
E) The general ledger account that is supported by a subsidiary ledger.
F)A contra-asset account used to reduce accounts receivable to its net realizable value.
G)The detail for a number of individual items that collectively make up a single general ledger account.
H)The recognition of bad debts expense at the point an account is written off as uncollectible.

Question 11

Earl's Company reported its accounts receivable turnover ratio at 10 times. Its credit terms are 2/10, n/20. What does this ratio tell you about Earl's Company?

Accepted Answer

At an accounts receivable turnover of 10

Question 12

Match the following definitions with their appropriate terms in the next eight questions.
-Aging schedule

Accepted Answer

A) A receivable arising from the sale of goods or services with a verbal promise to pay. 
B) A form used to categorize the various individual accounts receivable according to the length of time each has been outstanding. 
C) A method of estimating bad debts on the basis of either the net credit sales of the period or the accounts receivable at the end of the period. 
D) A measure of the number of times receivables are collected in a period. 
E) The general ledger account that is supported by a subsidiary ledger.
F)A contra-asset account used to reduce accounts receivable to its net realizable value.
G)The detail for a number of individual items that collectively make up a single general ledger account.
H)The recognition of bad debts expense at the point an account is written off as uncollectible. 
A) A receivable arising from the sale of goods or services with a verbal promise to pay. 
B) A form used to categorize the various individual accounts receivable according to the length of time each has been outstanding. 
C) A method of estimating bad debts on the basis of either the net credit sales of the period or the accounts receivable at the end of the period. 
D) A measure of the number of times receivables are collected in a period. 
E) The general ledger account that is supported by a subsidiary ledger.
F)A contra-asset account used to reduce accounts receivable to its net realizable value.
G)The detail for a number of individual items that collectively make up a single general ledger account.
H)The recognition of bad debts expense at the point an account is written off as uncollectible.

Question 13

The amount of cash the maker is to pay the payee on the maturity date of the note is called the
____________________.

Accepted Answer

The answer of The amount of cash the maker is...

Question 14

A contra-asset account used to reduce accounts receivable to its net realizable value is known as an
____________________.

Accepted Answer

allowance

Question 15

Assuming a company uses the allowance method, the entry to recognize the write-off of the specific uncollectible accounts will act to:

Accepted Answer

A)  Increase total assets and total equity 
B)  Increase total assets and decrease total equity 
C)  Decrease total assets and total equity 
D)  Not affect total assets or total equity 
A)  Increase total assets and total equity 
B)  Increase total assets and decrease total equity 
C)  Decrease total assets and total equity 
D)  Not affect total assets or total equity

Question 16

The data presented below is for Craft, Inc. for 2015.   What amount will Craft show on its year-end balance sheet for the net realizable value of its accounts receivable?

Accepted Answer

A)  $295,000 
B)  $267,000 
C)  $250,000 
D)  $ 28,000 
A)  $295,000 
B)  $267,000 
C)  $250,000 
D)  $ 28,000

Question 17

-Refer to the data for Music Corporation. If the aging approach is used to estimate bad debts, what is the balance in the Allowance for Doubtful Accounts after the bad debt expense adjustment?

Accepted Answer

A)  $8,000 
B)  $8,100 
C)  $8,900 
D)  $9,600 
A)  $8,000 
B)  $8,100 
C)  $8,900 
D)  $9,600

Question 18

Cash flows from purchases, sales, and maturities of investments are usually classified as operating activities.

Accepted Answer

A) True 
 B)False

Question 19

The the accounts receivable turnover ratio, the quicker the each dollar of accounts receivable can be collected.

Accepted Answer

The answer of The the accounts receivable turnover ratio, the...

Question 20

Bagel Inc. reported net income of $105,000 for the year ended December 31, 2014. The following items were
included on Bagel's balance sheets at December 31, 2014 and 2013:
   Bagel uses the indirect method to prepare its statement of cash flows. Bagel does not have any other current assets or current liabilities and did not enter into any investing or financing activities during 2014.
REQUIRED:
1. Prepare Bagel's 2014 statement of cash flows.
2. Draft a brief memo to the owner to explain why cash decreased during a profitable year.

Accepted Answer

1. Statement of cash flows:
 @#IMG-DLM& @#IMG-DLM& 
2. Memor

Match the following definitions with their appropriate terms in the next 14 questions. -Maturity date

Match the following definitions with their appropriate terms in the next 14 questions. -Maturity value

Why do businesses invest in short-term investments?

The alternate term for a credit card draft is an invoice.

Both stock and bond investments have maturity dates.

Why does the discounting of a note receivable with recourse result in a contingent liability? Should the liability be reported on the balance sheet? Explain.

How will the payee of the promissory note record the note on its books?

Refer to the data for Slammer Sports. If the aging approach is used to estimate bad debts, how much is the net realizable value of the accounts receivable at December 31, 2014?

Match the following definitions with their appropriate terms in the next eight questions. -Allowance method

Earl's Company reported its accounts receivable turnover ratio at 10 times. Its credit terms are 2/10, n/20. What does this ratio tell you about Earl's Company?

Match the following definitions with their appropriate terms in the next eight questions. -Aging schedule

The amount of cash the maker is to pay the payee on the maturity date of the note is called the ____________________.

A contra-asset account used to reduce accounts receivable to its net realizable value is known as an ____________________.

Assuming a company uses the allowance method, the entry to recognize the write-off of the specific uncollectible accounts will act to:

The data presented below is for Craft, Inc. for 2015. What amount will Craft show on its year-end balance sheet for the net realizable value of its accounts receivable?

-Refer to the data for Music Corporation. If the aging approach is used to estimate bad debts, what is the balance in the Allowance for Doubtful Accounts after the bad debt expense adjustment?

Cash flows from purchases, sales, and maturities of investments are usually classified as operating activities.

The the accounts receivable turnover ratio, the quicker the each dollar of accounts receivable can be collected.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International-Financial-Reporting-Standards

Filters

Exam 7: Receivables and Investments

Match the following definitions with their appropriate terms in the next 14 questions. -Maturity date

Match the following definitions with their appropriate terms in the next 14 questions. -Maturity value

Why do businesses invest in short-term investments?

The alternate term for a credit card draft is an invoice.

Both stock and bond investments have maturity dates.

Why does the discounting of a note receivable with recourse result in a contingent liability? Should the liability be reported on the balance sheet? Explain.

How will the payee of the promissory note record the note on its books?

Refer to the data for Slammer Sports. If the aging approach is used to estimate bad debts, how much is the net realizable value of the accounts receivable at December 31, 2014?

Match the following definitions with their appropriate terms in the next eight questions. -Allowance method

Earl's Company reported its accounts receivable turnover ratio at 10 times. Its credit terms are 2/10, n/20. What does this ratio tell you about Earl's Company?

Match the following definitions with their appropriate terms in the next eight questions. -Aging schedule

The amount of cash the maker is to pay the payee on the maturity date of the note is called the ____________________.

A contra-asset account used to reduce accounts receivable to its net realizable value is known as an ____________________.

Assuming a company uses the allowance method, the entry to recognize the write-off of the specific uncollectible accounts will act to:

The data presented below is for Craft, Inc. for 2015. What amount will Craft show on its year-end balance sheet for the net realizable value of its accounts receivable?

-Refer to the data for Music Corporation. If the aging approach is used to estimate bad debts, what is the balance in the Allowance for Doubtful Accounts after the bad debt expense adjustment?

Cash flows from purchases, sales, and maturities of investments are usually classified as operating activities.

The the accounts receivable turnover ratio, the quicker the each dollar of accounts receivable can be collected.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International-Financial-Reporting-Standards

Filters