Exam 8: Receivables

Of the two methods of accounting for uncollectible receivables,the allowance method provides in advance for uncollectible receivables.

If the maker of a promissory note fails to pay the note on the due date,the note is said to be

The collection of an account that had been previously written off under the allowance method of accounting for uncollectibles

The difference between the balance in Accounts Receivable and the balance in the Allowance for Doubtful Accounts is called the net realizable value of the receivables.

When the allowance method is used to account for uncollectible accounts,Bad Debts Expense is debited when

The term "receivables" includes all

If the direct write-off method of accounting for uncollectible receivables is used,what general ledger account is debited to write off a customer's account as uncollectible?

Discount Mart utilizes the allowance method of accounting for uncollectible receivables.On December 12 the company receives a $550 check from Chad Thomas in settlement of Thomas's $1,100 outstanding accounts receivable.Due to Thomas's failing health he is closing his company and is expecting to make no further payments to Discount Mart.Journalize this declaration.

On the balance sheet,the amount shown for the Allowance for Doubtful Accounts is equal to the

When a company receives an interest-bearing note receivable,it will

At the end of the current year,Accounts Receivable has a balance of $675,000; Allowance for Doubtful Accounts has a debit balance of $5,400; and sales for the year total $3,000,000.An analysis of receivables indicates the uncollectible receivables are estimated to be $45,000. Determine a the amount of the adjusting entry for bad debt expense; b the adjusted balances of Accounts Receivable,Allowance for Doubtful Accounts,and Bad Debt Expense; and c the net realizable value of accounts receivable.

When a note is received from a customer on account,it is recorded by debiting Notes Receivable and crediting Accounts Receivable.

Which of the following receivables would not be classified as an "other receivable"?

Watson Company issued a 60-day,8% note for $18,000,dated April 5,to Laker Company on account.Assume a 360-day year when calculating interest. a. Determine the due date of the note. b. Determine the maturity value of the note. c. Journalize the entries to record the following: 1- Receipt of the note by the payee 2- Receipt by the payee of the amount due on the note at maturity.Round answers to the nearest $1.

Under the allowance method of accounting for uncollectible receivables,writing off an uncollectible account.

A disadvantage of factoring is that the company selling its receivables immediately receives cash.

Abbott Company uses the allowance method of accounting for uncollectible accounts.Abbott estimates that 3% of net credit sales will be uncollectible.On January 1,the Allowance for Doubtful Accounts had a credit balance of $2,400.During the year,Abbott wrote off accounts receivable totaling $1,800 and made credit sales of $100,000.There were no sales returns or sales discounts during the year.After the adjusting entry,the December 31,balance in the Bad Debt Expense will be

If the maker of a note fails to pay the debt on the due date,the note is said to be dishonored.

When companies sell their receivables to other companies,the transaction is called factoring.

When using the direct write-off method of accounting for uncollectible receivables,the account Allowance for Doubtful Accounts is debited when a specific account is determined to be uncollectible.