Question 1

The formula: principle x rate x time represents

Accepted Answer

A) The amount charged for loaning money. 
B) The amount of revenue to the creditor for loaning money. 
C) The amount of expense to the debtor for borrowing money. 
D) All of the above. 
A) The amount charged for loaning money. 
B) The amount of revenue to the creditor for loaning money. 
C) The amount of expense to the debtor for borrowing money. 
D) All of the above.

Question 2

Principal is the amount loaned out by the ________ and borrowed by the ________.

Accepted Answer

A) payee of a note,creditor 
B) maker of a note,payee of a note 
C) debtor,maker of a note 
D) payee of a note,maker of a note 
A) payee of a note,creditor 
B) maker of a note,payee of a note 
C) debtor,maker of a note 
D) payee of a note,maker of a note

Question 3

What type of account is Allowance for Doubtful Accounts?

Accepted Answer

A) A contra-asset account 
B) An expense account 
C) A contra-liability account 
D) A revenue account 
A) A contra-asset account 
B) An expense account 
C) A contra-liability account 
D) A revenue account

Question 4

When a customer fails to pay on their account,it creates a(n):

Accepted Answer

A) note receivable. 
B) uncollectible account. 
C) account receivable. 
D) decrease in revenue. 
A) note receivable. 
B) uncollectible account. 
C) account receivable. 
D) decrease in revenue.

Question 5

When counting the days of a note,one should remember to count the day the note was issued.

Accepted Answer

A) True 
 B)False

Question 6

A customer's written promise to pay an amount of money to a business with interest is a(n)________ of the business.

Accepted Answer

A) account receivable 
B) account payable 
C) note receivable 
D) note payable 
A) account receivable 
B) account payable 
C) note receivable 
D) note payable

Question 7

The journal entry to record the set-up of a petty cash fund is to debit Petty Cash and to credit Cash.

Accepted Answer

A) True 
 B)False

Question 8

Cypress Co.has given you the following information from its aging of Accounts Receivable.Using this information,determine the amount of the journal entry to record the estimated uncollectible accounts.
 
The current balance in Allowance for Doubtful Accounts is a $326 debit.

Accepted Answer

A) $909 
B) $1,235 
C) $1,561 
D) $1,887 
A) $909 
B) $1,235 
C) $1,561 
D) $1,887

Question 9

A fund that contains a small amount of cash and is used to pay for minor expenditures is known as:

Accepted Answer

A) the emergency fund. 
B) the checking account. 
C) the petty cash fund. 
D) the cash account. 
A) the emergency fund. 
B) the checking account. 
C) the petty cash fund. 
D) the cash account.

Question 10

During a bank reconciliation,S & C Inc.discovered a NSF check from their customer,Marla Hicks for $35.The journal entry required to update the cash balance would be:

Accepted Answer

A) Debit cash,credit Accounts Receivable 
B) Debit Accounts Receivable,credit Cash 
C) Debit Accounts Receivable - M.Hicks,credit Cash 
D) No journal entry is required. 
A) Debit cash,credit Accounts Receivable 
B) Debit Accounts Receivable,credit Cash 
C) Debit Accounts Receivable - M.Hicks,credit Cash 
D) No journal entry is required.

Question 11

Capital Masonry has given you the following information from its aging of Accounts Receivable.Using this information,determine the amount of the journal entry to record the estimated uncollectible accounts.
 
The current balance in Allowance for Doubtful Accounts is a $146 debit.

Accepted Answer

A) $952 
B) $1,098 
C) $1,759 
D) $806 
A) $952 
B) $1,098 
C) $1,759 
D) $806

Question 12

Cypress Inc.deposited $2,000 into its bank account at the end of the month,but the bank statement does not show the deposit.This $2,000 is an example of a(n):

Accepted Answer

A) outstanding check. 
B) bank error. 
C) bank collection. 
D) deposit in transit. 
A) outstanding check. 
B) bank error. 
C) bank collection. 
D) deposit in transit.

Question 13

Under the direct write-off method,to record the receipt of cash after an account has previously being written off,you would first:

Accepted Answer

A) debit Cash and credit the customer's account. 
B) reinstate the customer's account. 
C) debit Allowance for Doubtful Accounts. 
D) debit Bad Debt Expense. 
A) debit Cash and credit the customer's account. 
B) reinstate the customer's account. 
C) debit Allowance for Doubtful Accounts. 
D) debit Bad Debt Expense.

Question 14

Cash equivalents may include money orders and traveler's checks.

Accepted Answer

A) True 
 B)False

Question 15

A company with a quick ratio of 1.23 means that the company:

Accepted Answer

A) has $1.00 in quick assets for every $1.23 in current liabilities. 
B) has $1.23 in quick assets for every $1.00 in current liabilities. 
C) could not pay off all of its current liabilities using quick assets. 
D) would have to use inventory to help pay off its current liabilities. 
A) has $1.00 in quick assets for every $1.23 in current liabilities. 
B) has $1.23 in quick assets for every $1.00 in current liabilities. 
C) could not pay off all of its current liabilities using quick assets. 
D) would have to use inventory to help pay off its current liabilities.

Question 16

There are two methods for accounting for uncollectible receivables.

Accepted Answer

A) True 
 B)False

Question 17

TLR Corporation lent $25,000 to Blitz,Inc.for 75 days at 7% interest on November 22,2013.How much interest will have accrued to TLR Corporation on December 31,2013,assuming a 360-day year?

Accepted Answer

A) $364.58 
B) $189.58 
C) $175.00 
D) Some other number 
A) $364.58 
B) $189.58 
C) $175.00 
D) Some other number

Question 18

Piper,Inc.had credit sales for the period of $85,000.The balance in Allowance for Doubtful Accounts is a debit of $817.What is the credit to Allowance for Doubtful Accounts if Piper uses the aging method to estimate uncollectible accounts and an aging of Accounts Receivable reflected an estimated amount of uncollectible accounts of $6,342?

Accepted Answer

A) $7,159 
B) $5,525 
C) $6,342 
D) $4,250 
A) $7,159 
B) $5,525 
C) $6,342 
D) $4,250

Question 19

The journal entry to write off a customer's account under the allowance method is:

Accepted Answer

A) Bad Debt Expense,debit;Allowance for Uncollectible Accounts,credit. 
B) not required. 
C) Allowance for Uncollectible Accounts,debit;Accounts Receivable/customer name,credit. 
D) Bad Debt Expense,debit;Accounts Receivable/customer name,credit. 
A) Bad Debt Expense,debit;Allowance for Uncollectible Accounts,credit. 
B) not required. 
C) Allowance for Uncollectible Accounts,debit;Accounts Receivable/customer name,credit. 
D) Bad Debt Expense,debit;Accounts Receivable/customer name,credit.

Question 20

When companies extend credit to customers:

Accepted Answer

A) sales generally decrease. 
B) the likelihood of not collecting money from customers decreases. 
C) the likelihood of not collecting money from customers increases. 
D) the business stays the same. 
A) sales generally decrease. 
B) the likelihood of not collecting money from customers decreases. 
C) the likelihood of not collecting money from customers increases. 
D) the business stays the same.

The formula: principle x rate x time represents

Principal is the amount loaned out by the and borrowed by the .

What type of account is Allowance for Doubtful Accounts?

When a customer fails to pay on their account,it creates a(n):

When counting the days of a note,one should remember to count the day the note was issued.

A customer's written promise to pay an amount of money to a business with interest is a(n)________ of the business.

The journal entry to record the set-up of a petty cash fund is to debit Petty Cash and to credit Cash.

Cypress Co.has given you the following information from its aging of Accounts Receivable.Using this information,determine the amount of the journal entry to record the estimated uncollectible accounts. The current balance in Allowance for Doubtful Accounts is a $326 debit.

A fund that contains a small amount of cash and is used to pay for minor expenditures is known as:

During a bank reconciliation,S & C Inc.discovered a NSF check from their customer,Marla Hicks for $35.The journal entry required to update the cash balance would be:

Capital Masonry has given you the following information from its aging of Accounts Receivable.Using this information,determine the amount of the journal entry to record the estimated uncollectible accounts. The current balance in Allowance for Doubtful Accounts is a $146 debit.

Cypress Inc.deposited $2,000 into its bank account at the end of the month,but the bank statement does not show the deposit.This $2,000 is an example of a(n):

Under the direct write-off method,to record the receipt of cash after an account has previously being written off,you would first:

Cash equivalents may include money orders and traveler's checks.

A company with a quick ratio of 1.23 means that the company:

There are two methods for accounting for uncollectible receivables.

TLR Corporation lent $25,000 to Blitz,Inc.for 75 days at 7% interest on November 22,2013.How much interest will have accrued to TLR Corporation on December 31,2013,assuming a 360-day year?

The journal entry to write off a customer's account under the allowance method is:

When companies extend credit to customers:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Long-Term and Other Assets

Current Liabilities and Long-Term Debt

Corporations: Paid-In Capital and Retained Earnings

The Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 7: Cash and Receivables

The formula: principle x rate x time represents

Principal is the amount loaned out by the ________ and borrowed by the ________.

What type of account is Allowance for Doubtful Accounts?

When a customer fails to pay on their account,it creates a(n):

When counting the days of a note,one should remember to count the day the note was issued.

A customer's written promise to pay an amount of money to a business with interest is a(n)________ of the business.

The journal entry to record the set-up of a petty cash fund is to debit Petty Cash and to credit Cash.

Cypress Co.has given you the following information from its aging of Accounts Receivable.Using this information,determine the amount of the journal entry to record the estimated uncollectible accounts. The current balance in Allowance for Doubtful Accounts is a $326 debit.

A fund that contains a small amount of cash and is used to pay for minor expenditures is known as:

During a bank reconciliation,S & C Inc.discovered a NSF check from their customer,Marla Hicks for $35.The journal entry required to update the cash balance would be:

Capital Masonry has given you the following information from its aging of Accounts Receivable.Using this information,determine the amount of the journal entry to record the estimated uncollectible accounts. The current balance in Allowance for Doubtful Accounts is a $146 debit.

Cypress Inc.deposited $2,000 into its bank account at the end of the month,but the bank statement does not show the deposit.This $2,000 is an example of a(n):

Under the direct write-off method,to record the receipt of cash after an account has previously being written off,you would first:

Cash equivalents may include money orders and traveler's checks.

A company with a quick ratio of 1.23 means that the company:

There are two methods for accounting for uncollectible receivables.

TLR Corporation lent $25,000 to Blitz,Inc.for 75 days at 7% interest on November 22,2013.How much interest will have accrued to TLR Corporation on December 31,2013,assuming a 360-day year?

The journal entry to write off a customer's account under the allowance method is:

When companies extend credit to customers:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Long-Term and Other Assets

Current Liabilities and Long-Term Debt

Corporations: Paid-In Capital and Retained Earnings

The Statement of Cash Flows

Financial Statement Analysis

Filters

Principal is the amount loaned out by the and borrowed by the .