Question 1

Journalize the following transactions (Assume a 360-day year when calculating interest.):

Accepted Answer

The answer of Journalize the following transactions (Assume a 360-day...

Question 2

Dalton Company uses the allowance method to account for uncollectible receivables. Dalton has determined that the Irish Company account is uncollectible. To write-off this account, Dalton should debit

Accepted Answer

A)  Bad Debt Expense and credit Accounts Receivable 
B)  Bad Debt Expense and credit Allowance for Doubtful Accounts 
C)  Allowance for Doubtful Accounts and credit Accounts Receivable 
D)  Accounts receivable and credit Allowance for Doubtful Accounts 
A)  Bad Debt Expense and credit Accounts Receivable 
B)  Bad Debt Expense and credit Allowance for Doubtful Accounts 
C)  Allowance for Doubtful Accounts and credit Accounts Receivable 
D)  Accounts receivable and credit Allowance for Doubtful Accounts

Question 3

Journalize the following transactions using the allowance method of accounting for uncollectible receivables.
April 1 Sold merchandise on account to Jim Dobbs, $7,200. The cost of the merchandise is $5,400.
June 10 Received payment for one-third of the receivable from Jim Dobbs and wrote off the remainder.
Oct. 11 Reinstated the account of Jim Dobbs and received cash in full payment.

Accepted Answer

The answer of Journalize the following transactions using the allowance...

Question 4

Allowance for Doubtful Accounts is a liability account.

Accepted Answer

A) True 
 B)False

Question 5

The accounts receivables turnover ratio is computed by dividing total gross sales by the average net receivables during the year.

Accepted Answer

A) True 
 B)False

Question 6

On August 1, Kim Company accepted a 90-day note receivable as payment for services provided to Hsu Company. The terms of the note were $20,000 face value and 6% interest. On October 30, the journal entry to record the collection of the note should include a

Accepted Answer

A)  credit to Notes Receivable for $20,300 
B)  debit to Interest Receivable for $300 
C)  credit to Interest Revenue for $300 
D)  debit to Notes Receivable for $20,000 
A)  credit to Notes Receivable for $20,300 
B)  debit to Interest Receivable for $300 
C)  credit to Interest Revenue for $300 
D)  debit to Notes Receivable for $20,000

Question 7

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

Accepted Answer

A)  will increase net income in the period it is collected. 
B)  will decrease net income in the period it is collected. 
C)  does not affect net income in the period it is collected. 
D)  requires a correcting entry for the period in which the account was written off. 
A)  will increase net income in the period it is collected. 
B)  will decrease net income in the period it is collected. 
C)  does not affect net income in the period it is collected. 
D)  requires a correcting entry for the period in which the account was written off.

Question 8

Using the allowance method of accounting for uncollectible receivables, the entry to reinstate a specific receivable previously written off would include a

Accepted Answer

A)  credit to Bad Debt Expense 
B)  credit to Accounts Receivable 
C)  debit to Allowance for Doubtful Accounts 
D)  debit to Accounts Receivable 
A)  credit to Bad Debt Expense 
B)  credit to Accounts Receivable 
C)  debit to Allowance for Doubtful Accounts 
D)  debit to Accounts Receivable

Question 9

When using the estimate based on sales method, the entry to record uncollectible accounts expense includes a credit to the Accounts Receivable account.

Accepted Answer

A) True 
 B)False

Question 10

The interest on a 6%, 60-day note for $5,000 is $300.

Accepted Answer

A) True 
 B)False

Question 11

Other than accounts receivable and notes receivable, name other receivables that might be included in the general ledger.

Accepted Answer

Interest Receivable,

Question 12

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

Accepted Answer

A)  Advance to an employee 
B)  Interest receivable 
C)  Refundable income tax 
D)  Notes receivable 
A)  Advance to an employee 
B)  Interest receivable 
C)  Refundable income tax 
D)  Notes receivable

Question 13

In computing the maturity date of a note, the date the note is issued is included but the due date is omitted.

Accepted Answer

A) True 
 B)False

Question 14

A note receivable due in 18 months is listed on the balance sheet under the caption

Accepted Answer

A)  long-term liabilities 
B)  fixed assets 
C)  current assets 
D)  investments 
A)  long-term liabilities 
B)  fixed assets 
C)  current assets 
D)  investments

Question 15

Fellows Corporation has determined that the $2,700 accounts receivable due from Andrew Stevens is uncollectible. Compare the journal entry that is required under the direct write-off method to the journal entry that is required using the allowance method.

Accepted Answer

Under the direct write-off method, Bad D

Question 16

Notes Receivable and Accounts Receivable can also be called trade receivables.

Accepted Answer

A) True 
 B)False

Question 17

When using the analysis of receivables method for estimating uncollectible receivables, the amount computed in the analysis is usually the amount that would be recorded in the end-of-period adjusting entry.

Accepted Answer

A) True 
 B)False

Question 18

A $6,000, 60-day, 12% note recorded on November 21 is not paid by the maker at maturity. The journal entry to recognize this event is

Accepted Answer

A)  debit Cash, $6,120; credit Notes Receivable, $6,120 
B)  debit Accounts Receivable, $6,120; credit Notes Receivable, $6,000; Credit Interest Receivable, $120 
C)  debit Notes Receivable, $6,060; credit Accounts Receivable, $6,060 
D)  debit Accounts Receivable, $6,120; credit Notes Receivable, $6,000; Credit Interest Revenue, $120 
A)  debit Cash, $6,120; credit Notes Receivable, $6,120 
B)  debit Accounts Receivable, $6,120; credit Notes Receivable, $6,000; Credit Interest Receivable, $120 
C)  debit Notes Receivable, $6,060; credit Accounts Receivable, $6,060 
D)  debit Accounts Receivable, $6,120; credit Notes Receivable, $6,000; Credit Interest Revenue, $120

Question 19

The balance in Allowance for Doubtful Accounts will directly impact the end of period adjustment for the bad debt expense when using which of the following methods?

Accepted Answer

A)  Allowance method 
B)  Direct write-off method 
C)  Accrual method 
D)  declining value method 
A)  Allowance method 
B)  Direct write-off method 
C)  Accrual method 
D)  declining value method

Question 20

The receivable that is usually evidenced by a formal instrument of credit is a(n)

Accepted Answer

A)  trade receivable. 
B)  note receivable. 
C)  accounts receivable. 
D)  income tax receivable. 
A)  trade receivable. 
B)  note receivable. 
C)  accounts receivable. 
D)  income tax receivable.

Exam 9: Receivables

Journalize the following transactions (Assume a 360-day year when calculating interest.):

Dalton Company uses the allowance method to account for uncollectible receivables. Dalton has determined that the Irish Company account is uncollectible. To write-off this account, Dalton should debit

Allowance for Doubtful Accounts is a liability account.

The accounts receivables turnover ratio is computed by dividing total gross sales by the average net receivables during the year.

On August 1, Kim Company accepted a 90-day note receivable as payment for services provided to Hsu Company. The terms of the note were $20,000 face value and 6% interest. On October 30, the journal entry to record the collection of the note should include a

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

Using the allowance method of accounting for uncollectible receivables, the entry to reinstate a specific receivable previously written off would include a

When using the estimate based on sales method, the entry to record uncollectible accounts expense includes a credit to the Accounts Receivable account.

The interest on a 6%, 60-day note for $5,000 is $300.

Other than accounts receivable and notes receivable, name other receivables that might be included in the general ledger.

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

In computing the maturity date of a note, the date the note is issued is included but the due date is omitted.

A note receivable due in 18 months is listed on the balance sheet under the caption

Fellows Corporation has determined that the $2,700 accounts receivable due from Andrew Stevens is uncollectible. Compare the journal entry that is required under the direct write-off method to the journal entry that is required using the allowance method.

Notes Receivable and Accounts Receivable can also be called trade receivables.

When using the analysis of receivables method for estimating uncollectible receivables, the amount computed in the analysis is usually the amount that would be recorded in the end-of-period adjusting entry.

A $6,000, 60-day, 12% note recorded on November 21 is not paid by the maker at maturity. The journal entry to recognize this event is

The balance in Allowance for Doubtful Accounts will directly impact the end of period adjustment for the bad debt expense when using which of the following methods?

The receivable that is usually evidenced by a formal instrument of credit is a(n)

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

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