Question 1

The experience of other firms in the same line of business may be used in estimating losses from uncollectible accounts for a new firm.

Accepted Answer

A) True 
 B)False  True

Question 2

Which of the following statements is not correct?

Accepted Answer

A)  The allowance method involves anticipating losses from uncollectible accounts by recognizing an expense for these losses before the actual accounts are written off. 
B)  The adjusting entry to record the estimated loss from uncollectible accounts includes a credit to Accounts Receivable. 
C)  Losses from uncollectible accounts can be estimated by analyzing sales or accounts receivable. 
D)  The balance of Uncollectible Accounts Expense appears among the operating expenses on the income statement. 
A)  The allowance method involves anticipating losses from uncollectible accounts by recognizing an expense for these losses before the actual accounts are written off. 
B)  The adjusting entry to record the estimated loss from uncollectible accounts includes a credit to Accounts Receivable. 
C)  Losses from uncollectible accounts can be estimated by analyzing sales or accounts receivable. 
D)  The balance of Uncollectible Accounts Expense appears among the operating expenses on the income statement. B

Question 3

Allowance for Doubtful Accounts has a credit balance of $2,000 immediately before the write-off of a $600 account receivable.The balance of Allowance for Doubtful Accounts immediately after the write-off is

Accepted Answer

A)  $600 debit. 
B)  $1,400 credit. 
C)  $1,400 debit. 
D)  $2,600 credit. 
A)  $600 debit. 
B)  $1,400 credit. 
C)  $1,400 debit. 
D)  $2,600 credit. B

Question 4

A firm reported sales of $500,000 during the year.Prior to adjustment,Allowance for Doubtful Accounts has a credit balance of $100.Based on an aging of accounts receivable,the firm estimated its losses from uncollectible accounts to be $5,200.The adjusting entry to record the estimated bad debt losses will be:

Accepted Answer

A) 
  
B) 
  
C) 
  
D) 
  
A) 
  
B) 
  
C) 
  
D)

Question 5

A firm reported sales of $300,000 during the year.Prior to adjustment,Allowance for Doubtful Accounts has a debit balance of $100.Based on an aging of accounts receivable,the firm estimated its losses from uncollectible accounts to be $3,150.The entry to record the estimated bad debt losses will be:

Accepted Answer

A) 
  
B) 
  
C) 
  
D) 
  
A) 
  
B) 
  
C) 
  
D)

Question 6

Allowance for Doubtful Accounts has a credit balance of $1,000 immediately before the write-off of a $300 account receivable.The credit balance of Allowance for Doubtful Accounts immediately after the write-off is

Accepted Answer

A)  $700. 
B)  $1,000. 
C)  $1,300. 
D)  $300. 
A)  $700. 
B)  $1,000. 
C)  $1,300. 
D)  $300.

Question 7

When using the allowance method,the collection of an account previously written off is recorded in the cash receipts journal only.

Accepted Answer

A) True 
 B)False

Question 8

On December 31,prior to adjustments,the balance of Accounts Receivable is $52,000 and Allowance for Doubtful Accounts has a debit balance of $600.The firm estimates its losses from uncollectible accounts to be 5% of accounts receivable at the end of the year.The adjusting entry needed to record the estimated losses from uncollectible accounts is made for

Accepted Answer

A)  $600. 
B)  $2,000. 
C)  $2,600. 
D)  $3,200. 
A)  $600. 
B)  $2,000. 
C)  $2,600. 
D)  $3,200.

Question 9

When the allowance method of recognizing losses from uncollectible accounts is used,the entry to record the write-off of a specific account consists of a debit to

Accepted Answer

A)  Uncollectible Accounts Expense and a credit to Accounts Receivable. 
B)  Allowance for Doubtful Accounts and a credit to Accounts Receivable. 
C)  Uncollectible Accounts Expense and a credit to Allowance for Doubtful Accounts. 
D)  Accounts Receivable and a credit to Allowance for Doubtful Accounts. 
A)  Uncollectible Accounts Expense and a credit to Accounts Receivable. 
B)  Allowance for Doubtful Accounts and a credit to Accounts Receivable. 
C)  Uncollectible Accounts Expense and a credit to Allowance for Doubtful Accounts. 
D)  Accounts Receivable and a credit to Allowance for Doubtful Accounts.

Question 10

Under the Allowance Method of accounting for uncollectible accounts,a firm should base their estimate of uncollectible accounts on all of the following EXCEPT:

Accepted Answer

A)  net credit sales for the year 
B)  total current assets as of the end of the year 
C)  total accounts receivable at the end of the year 
D)  aging of accounts receivable at the end of the year 
A)  net credit sales for the year 
B)  total current assets as of the end of the year 
C)  total accounts receivable at the end of the year 
D)  aging of accounts receivable at the end of the year

Question 11

A firm using the allowance method to provide for losses from uncollectible accounts collected the cash due from a customer whose account was previously written off.The entry to reinstate the customer's account included a credit to

Accepted Answer

A)  Sales. 
B)  Accounts Receivable. 
C)  Uncollectible Accounts Expense. 
D)  Allowance for Doubtful Accounts. 
A)  Sales. 
B)  Accounts Receivable. 
C)  Uncollectible Accounts Expense. 
D)  Allowance for Doubtful Accounts.

Question 12

On December 31,prior to adjustment,Allowance for Doubtful Accounts has a credit balance of $400.An aging analysis of the accounts receivable produces an estimate of $2,000 of probable losses from uncollectible accounts.The adjusting entry needed to record the estimated losses from uncollectible accounts is made for

Accepted Answer

A)  $400. 
B)  $1,600. 
C)  $2,000. 
D)  $2,400. 
A)  $400. 
B)  $1,600. 
C)  $2,000. 
D)  $2,400.

Question 13

After the adjusting entry is made to record the estimate of losses from uncollectible accounts,Allowance for Doubtful Accounts should have a(n)____________________ balance.

Accepted Answer

The answer of After the adjusting entry is made to...

Question 14

A firm reported net credit sales of $225,000 during the year and has a balance of $20,000 in its Accounts Receivable account at year-end.Prior to adjustments,Allowance for Doubtful Accounts has a debit balance of $100.The firm estimates its losses from uncollectible accounts to be one-half of 1 percent of net credit sales.The entry to record the estimated losses from uncollectible accounts will include a credit to Allowance for Doubtful Accounts for

Accepted Answer

A)  $1,225. 
B)  $1,125. 
C)  $900. 
D)  $2,250. 
A)  $1,225. 
B)  $1,125. 
C)  $900. 
D)  $2,250.

Question 15

On December 31,2016,prior to adjustments,Accounts Receivable has a debit balance of $370,000 and the Allowance for Doubtful Accounts has a credit balance of $400.The firm estimates its losses from uncollectible accounts to be 5% of accounts receivable at the end of the year.The amount of the adjusting entry needed to record the estimated losses from uncollectible accounts is

Accepted Answer

A)  $18,100 
B)  $18,500 
C)  $18,900 
D)  $17,800 
A)  $18,100 
B)  $18,500 
C)  $18,900 
D)  $17,800

Question 16

Uncollectible Accounts Expense can be called Loss from Uncollectible Accounts.

Accepted Answer

A) True 
 B)False

Question 17

On December 31,prior to adjustment,Allowance for Doubtful Accounts has a credit balance of $200.An aging Analyze of the accounts receivable produces an estimate of $1,000 of probable losses from uncollectible accounts.The adjusting entry needed to record the estimated losses from uncollectible accounts is made for

Accepted Answer

A)  $200. 
B)  $800. 
C)  $1,000. 
D)  $1,200. 
A)  $200. 
B)  $800. 
C)  $1,000. 
D)  $1,200.

Question 18

On December 31,2016,prior to adjustments,Accounts Receivable has a debit balance of $356,000 and the Allowance for Doubtful Accounts has a credit balance of $1,200.The firm estimates its losses from uncollectible accounts to be 4% of accounts receivable at the end of the year.The balance in the Allowance for Doubtful Accounts after the adjusting entry for the estimated losses from uncollectible accounts is:

Accepted Answer

A)  $13,040 
B)  $14,240 
C)  $15,440 
D)  $17,800 
A)  $13,040 
B)  $14,240 
C)  $15,440 
D)  $17,800

Question 19

Allowance for Doubtful Accounts is classified as

Accepted Answer

A)  a Contra Asset on the Balance Sheet. 
B)  a Liability on the Balance Sheet. 
C)  an Expense on the Income Statement. 
D)  A Contra Expense on the Income Statement. 
A)  a Contra Asset on the Balance Sheet. 
B)  a Liability on the Balance Sheet. 
C)  an Expense on the Income Statement. 
D)  A Contra Expense on the Income Statement.

Question 20

The allowance method may be used to record bad debt losses for income tax purposes.

Accepted Answer

A) True 
 B)False

Exam 15: Accounts Receivable and Uncollectible Accounts

The experience of other firms in the same line of business may be used in estimating losses from uncollectible accounts for a new firm.

Which of the following statements is not correct?

Allowance for Doubtful Accounts has a credit balance of $2,000 immediately before the write-off of a $600 account receivable.The balance of Allowance for Doubtful Accounts immediately after the write-off is

Allowance for Doubtful Accounts has a credit balance of $1,000 immediately before the write-off of a $300 account receivable.The credit balance of Allowance for Doubtful Accounts immediately after the write-off is

When using the allowance method,the collection of an account previously written off is recorded in the cash receipts journal only.

When the allowance method of recognizing losses from uncollectible accounts is used,the entry to record the write-off of a specific account consists of a debit to

Under the Allowance Method of accounting for uncollectible accounts,a firm should base their estimate of uncollectible accounts on all of the following EXCEPT:

A firm using the allowance method to provide for losses from uncollectible accounts collected the cash due from a customer whose account was previously written off.The entry to reinstate the customer's account included a credit to

After the adjusting entry is made to record the estimate of losses from uncollectible accounts,Allowance for Doubtful Accounts should have a(n)____________________ balance.

Uncollectible Accounts Expense can be called Loss from Uncollectible Accounts.

Allowance for Doubtful Accounts is classified as

The allowance method may be used to record bad debt losses for income tax purposes.

Accounting: the Language of Business

Analyzing Business Transactions

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and the Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Cash Receipts, Cash Payments, and Banking Procedures

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Notes Payable and Notes Receivable

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Corporate Earnings and Capital Transactions

Long-Term Bonds

Financial Statement Analyses

The Statement of Cash Flows

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Job Order Cost Accounting

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Cost-Revenue Analysis for Decision Making

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