Exam 4: Cash, Short-Term Investments and Accounts Receivable

During 2010, ABC Corp. purchased the following three short-term investments: ABC should recognize its short-term investments on the December 31 balance sheet at which of the following amounts?

In November 2009, Steeler Inc. wrote off a $3,800 account receivable from P. Burg. In May 2010, Burg remitted $1,500 of his account receivable to Steeler Inc. How would Steeler Inc. record the remittance?

A credit term of 2/10, n/30 states that customers will receive a 2% discount if they pay outstanding invoices within 30 days.

Which of the following are contra-revenue accounts?

A 90-day note receivable that is dated on April 30 comes due on July 29.

Credit card companies generally pay amounts owed to retailers on a more timely basis than do individual customers.

Recording an uncollectible account receivable as a bad debt expense when it is determined that the account receivable will not be collected

Use the following information to answer questions : While preparing the October 2010 bank reconciliation, Flores Inc.'s accountant identified the following items: -What is the net effect of the reconciling items on the bank balance?

Assuming a 360-day year, the age of receivables for a company with an accounts receivable turnover ratio of 4.5 is 80 days.

Accounts receivable may be used as collateral for borrowings in a process called

Which of the following is(are) cash equivalents?

On the balance sheet, Accounts Receivable is reduced by the contra-accounts of Sales Discounts, Sales Returns and Allowances, and Allowance for Uncollectible Accounts.

On June 1, Ellison Co. performed $10,000 of services on account for Kendra Corp. On July 1, Kendra asked Ellison to exchange its account for a 3-month, 12% note, which Ellison did. Kendra paid the note in full. Required: Prepare and date all necessary entries for Ellison Co.

The following are recent transactions and other events involving Urbina Corporation. Required: Journalize each of these transactions or events in Urbina's accounting records.

The actual amount of cash to be shown as an asset on a company's balance sheet is the amount of cash contained in the year-end bank statement.

Any investment in a short-term security that has 90 days or less to maturity when purchased is

Gray Corporation recently received its March 2010 bank statement, started its monthly bank reconciliation, and noticed the following reconciling items. Additional Information • Excluding the reconciling items noted above, Gray's cash account balance per general ledger is $1,987.50, and its cash balance per bank statement is $327.50. • When Check #127 was issued to buy office supplies, the check was mistakenly recorded as $70 rather than $700. Gray has used all the office supplies purchased with check #127. • Gray believes that the customer who gave the NSF check will pay the company in the near future. Required: a. Prepare Gray's March 2010 bank reconciliation. b. Prepare any necessary journal entries to adjust Gray's cash account balance per general ledger.

The following information is from McCaine Corporation's year-end 2009 and 2010 general ledger account information: What is McCaine's accounts receivable turnover ratio for 2010?

Measures that express the relationship or interrelationships between or among two or more financial statement items are

Use the following information to answer questions Foley Industries is estimating its allowance for uncollectible accounts at December 31, 2010 based on the following information: Seventy percent of Foley's total sales for 2010 are on credit. Foley has always estimated that 5% of credit sales will be uncollectible. -What is the balance in the Allowance for Uncollectible Accounts before the uncollectible accounts estimate entry is made on December 31, 2010?