Question 1

Both Accounts Receivable and Notes Receivable represent claims that are expected to be collected in cash.

Accepted Answer

A) True 
 B)False

Question 2

The equation for computing interest on an interest-bearing note is as follows: Interest = Maturity Value × Interest Rate × Time.

Accepted Answer

A) True 
 B)False

Question 3

Allowance for Doubtful Accounts is a liability account.

Accepted Answer

A) True 
 B)False

Question 4

Days' sales in receivables

Accepted Answer

A)  is an estimate of the length of time the receivables have been outstanding 
B)  measures the number of times the receivables turn over each year 
C)  is credit sales divided by average receivables 
D)  is not meaningful and therefore is not used 
A)  is an estimate of the length of time the receivables have been outstanding 
B)  measures the number of times the receivables turn over each year 
C)  is credit sales divided by average receivables 
D)  is not meaningful and therefore is not used

Question 5

When a company uses the allowance method of accounting for uncollectible receivables, the entry to reinstate a previously written off account would include a

Accepted Answer

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

Question 6

Match each description to the appropriate term (a-h).
-The time between the date a note is issued and the due date of the note

Accepted Answer

A) Face amount 
B) Term 
C) Interest 
D) Maturity value 
E) Dishonored note
F)Maker
G)Notes receivable
H)Interest rate 
A) Face amount 
B) Term 
C) Interest 
D) Maturity value 
E) Dishonored note
F)Maker
G)Notes receivable
H)Interest rate

Question 7

At the end of the current year, Accounts Receivable has a balance of $550,000; Allowance for Doubtful Accounts has a credit balance of $5,500; and sales for the year total $2,500,000. An analysis of receivables estimates uncollectible receivables as $25,000.​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.

Accepted Answer

The answer of At the end of the current year,...

Question 8

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

Accepted Answer

A)  displaced 
B)  disallowed 
C)  dishonored 
D)  discounted 
A)  displaced 
B)  disallowed 
C)  dishonored 
D)  discounted

Question 9

The maturity value of a 12%, 60-day note for $5,000 is $5,600.

Accepted Answer

A) True 
 B)False

Question 10

At the beginning of the year, the balance in Allowance for Doubtful Accounts is a credit of $760. During the year, previously written off accounts of $120 are reinstated and accounts totaling $740 are written off as uncollectible. The end-of-year balance (before adjustment) in Allowance for Doubtful Accounts should be

Accepted Answer

A)  $760 
B)  $120 
C)  $140 
D)  $740 
A)  $760 
B)  $120 
C)  $140 
D)  $740

Question 11

At the end of the current year, Accounts Receivable has a balance of $750,000; Allowance for Doubtful Accounts has a debit balance of $6,200; and sales for the year total $3,500,000. Bad debt expense is estimated at ½ of 1% of sales.?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.

Accepted Answer

\[\begin{array} { | l | l | r | } 
\hlin

Question 12

What is the type of account and normal balance of Allowance for Doubtful Accounts?

Accepted Answer

A)  contra asset, credit 
B)  asset, debit 
C)  asset, credit 
D)  contra asset, debit 
A)  contra asset, credit 
B)  asset, debit 
C)  asset, credit 
D)  contra asset, debit

Question 13

Allowance for Doubtful Accounts has a credit balance of $500 at the end of the year (before adjustment), and bad debt expense is estimated at 3% of credit sales. If credit sales are $300,000, the amount of the adjusting entry to record the estimated uncollectible accounts receivable

Accepted Answer

A)  is $8,500 
B)  is $9,500 
C)  is $9,000 
D)  cannot be determined 
A)  is $8,500 
B)  is $9,500 
C)  is $9,000 
D)  cannot be determined

Question 14

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

Accepted Answer

A)  affects only income statement accounts 
B)  is not an acceptable practice 
C)  affects only balance sheet accounts 
D)  affects both balance sheet and income statement accounts 
A)  affects only income statement accounts 
B)  is not an acceptable practice 
C)  affects only balance sheet accounts 
D)  affects both balance sheet and income statement accounts

Question 15

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 16

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

Accepted Answer

A)  uncollectible accounts expense for the year 
B)  total of the accounts receivable written off during the year 
C)  total estimated uncollectible accounts as of the end of the year 
D)  sum of all accounts that are past due 
A)  uncollectible accounts expense for the year 
B)  total of the accounts receivable written off during the year 
C)  total estimated uncollectible accounts as of the end of the year 
D)  sum of all accounts that are past due

Question 17

Journalize the following transactions of Upton Drugs:July 8Received a $180,000, 90-day, 8% note dated July 8 from Miracle Chemical on account.Oct. 6The note is dishonored by Miracle Chemical.Nov. 5Received the amount due on the dishonored note plus interest for 30 days at 10% on the total amount charged to Miracle Chemical on October 6.

Accepted Answer

@#LAT-DLM&
Oct. 6 Accounts Receivable-Mi

Question 18

Days' sales in receivables is an estimate of the length of time the accounts receivable have been outstanding.

Accepted Answer

A) True 
 B)False

Question 19

Allowance for Doubtful Accounts has a debit balance of $2,300 at the end of the year (before adjustment). The company prepares an analysis of customers' accounts and estimates the amount of uncollectible accounts to be $31,900. Which of the following adjusting entries is needed to record the bad debt expense for the year?

Accepted Answer

A)  debit Bad Debt Expense, $34,200; credit Allowance for Doubtful Accounts, $34,200 
B)  debit Allowance for Doubtful Accounts, $34,200; credit Bad Debt Expense, $34,200 
C)  debit Allowance for Doubtful Accounts, $29,600; credit Bad Debt Expense, $29,600 
D)  debit Bad Debt Expense, $29,600; credit Allowance for Doubtful Accounts, $29,600 
A)  debit Bad Debt Expense, $34,200; credit Allowance for Doubtful Accounts, $34,200 
B)  debit Allowance for Doubtful Accounts, $34,200; credit Bad Debt Expense, $34,200 
C)  debit Allowance for Doubtful Accounts, $29,600; credit Bad Debt Expense, $29,600 
D)  debit Bad Debt Expense, $29,600; credit Allowance for Doubtful Accounts, $29,600

Question 20

Other receivables include nontrade receivables such as loans to company officers.

Accepted Answer

A) True 
 B)False

Both Accounts Receivable and Notes Receivable represent claims that are expected to be collected in cash.

The equation for computing interest on an interest-bearing note is as follows: Interest = Maturity Value × Interest Rate × Time.

Allowance for Doubtful Accounts is a liability account.

Days' sales in receivables

When a company uses the allowance method of accounting for uncollectible receivables, the entry to reinstate a previously written off account would include a

Match each description to the appropriate term (a-h). -The time between the date a note is issued and the due date of the note

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

The maturity value of a 12%, 60-day note for $5,000 is $5,600.

What is the type of account and normal balance of Allowance for Doubtful Accounts?

Allowance for Doubtful Accounts has a credit balance of $500 at the end of the year (before adjustment), and bad debt expense is estimated at 3% of credit sales. If credit sales are $300,000, the amount of the adjusting entry to record the estimated uncollectible accounts receivable

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

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

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

Days' sales in receivables is an estimate of the length of time the accounts receivable have been outstanding.

Other receivables include nontrade receivables such as loans to company officers.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Internal Control and Cash

Long-Term Assets: Fixed and Intangible

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

Introduction to Managerial Accounting

Job Order Costing

Process Cost Systems

Cost-Volume-Profit Analysis

Evaluating Variances From Standard Costs

Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Filters

Exam 9: Receivables

Both Accounts Receivable and Notes Receivable represent claims that are expected to be collected in cash.

The equation for computing interest on an interest-bearing note is as follows: Interest = Maturity Value × Interest Rate × Time.

Allowance for Doubtful Accounts is a liability account.

Days' sales in receivables

When a company uses the allowance method of accounting for uncollectible receivables, the entry to reinstate a previously written off account would include a

Match each description to the appropriate term (a-h). -The time between the date a note is issued and the due date of the note

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

The maturity value of a 12%, 60-day note for $5,000 is $5,600.

What is the type of account and normal balance of Allowance for Doubtful Accounts?

Allowance for Doubtful Accounts has a credit balance of $500 at the end of the year (before adjustment), and bad debt expense is estimated at 3% of credit sales. If credit sales are $300,000, the amount of the adjusting entry to record the estimated uncollectible accounts receivable

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

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

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

Days' sales in receivables is an estimate of the length of time the accounts receivable have been outstanding.

Other receivables include nontrade receivables such as loans to company officers.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Internal Control and Cash

Long-Term Assets: Fixed and Intangible

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

Introduction to Managerial Accounting

Job Order Costing

Process Cost Systems

Cost-Volume-Profit Analysis

Evaluating Variances From Standard Costs

Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Filters