Exam 8: Receivables

On January 1,Wolfie's Supply sold $222 worth of goods to customer Abe Smith on account.For several months,Wolfie's tried unsuccessfully to collect from the customer,and finally decided to write off the account.(Wolfie's uses the allowance method.) Later in the year,however,the customer came in to Wolfie's,apologized for the late payment and handed over a check for $222.To properly record the recovery of an account previously written off,two journal entries are needed-one to restore the receivable previously written off,and one to record the cash receipt.Please show the first of these two entries.

A company has Net sales of $1,700,000,Beginning net receivables of $240,000 and Ending net receivables of $180,000.What is Days' sales in accounts receivable? (Please round to the nearest whole dollar.)

A record that contains the details by customer or vendor of the individual account balances would be called a:

Target allows customers to use MasterCard.They report sales of $24,000 for the week.MasterCard charges Target a 3% fee.The journal entry for this transaction would be:

The following information is from the 2013 records of Armadillo Camera Shop: Accounts receivable, December 31,2013 \ 20,000 (debit) Allowance for uncollectible accounts, December 31,2013 prior to adjustment 600 (debit) Net credit sales for 2013 95,000 Accounts written off as uncollectible during 2013 7,000 Cash sales during 2013 27,000 Uncollectible accounts expense is estimated by the aging-of-accounts-receivable method.Management estimates that $2,850 of accounts receivable will be uncollectible.Which of the following will be the amount of Net accounts receivable after adjustment?

Which of the following is included in the numerator of the acid-test ratio?

When a business accepts credit cards from customers in payment of sales,the business has to pay a fee to the credit card processor.

At January 1,Davidson Services has the following balances: Davidson has the following transactions during January: Credit sales of $80,000,collections of $76,000,and write-offs of $12,000. - Davidson uses the direct write-off method.At the end of January,the balance in Uncollectible accounts expense is:

The Allowance for uncollectible accounts currently has a credit balance of $900.After analyzing the accounts in the accounts receivable subsidiary ledger using the aging method,the company's management estimates that uncollectible accounts will be $15,000. -What will be the balance of the Allowance for uncollectible accounts reported on the balance sheet?

The number of times per year a company sells goods and collects receivables is known as the accounts receivable turnover.

A company uses the direct write-off method to account for uncollectible receivables.Which of the following is included in the entry to write off an uncollectible account?

Archer Company and Zorro Company both have significant amounts of accounts receivable at any time,and both experience uncollectible accounts from time to time.Archer uses the percent-of-sales method to account for uncollectible accounts,and Zorro uses the direct write-off method.Archer Company's method complies with GAAP and produces a better matching of revenues and expenses than does Zorro Company's method.

As Perry Materials Supply was preparing for the year-end close,their balances were as follows: Perry Materials uses the aging method and has completed the following analysis of the accounts receivable: Customer 1-30 Days 31-60 Days 61-90 Days Over 90 Days Total Balance Johnson \ 4,600 \ 3,200 \ 7,800 Hot Pots, Inc. 800 1,000 1,800 Potter 40,000 550 40,550 Harrison 3,600 900 4,500 Marz 2,000 50 2,050 Younger 65,000 65,000 Merry Maids 5,900 5,900 Acher 12,000 6,400 18,400 Totals \ 127,500 \ 13,750 \ 3,700 \ 1,050 \ 146,000 Uncollectible percentage 2\% 10\% 20\% 40\% Estimated uncollectible amount \ 2,550 \ 1,375 \ 740 \ 420 \ 5,085 - What will the final balance in the Allowance account be,after adjusting for uncollectible account expense?

A company has Net sales of $850,000,Beginning net receivables of $230,000 and Ending net receivables of $190,000.What is the days' sales in accounts receivable? (Please round to nearest whole day.)

The acid-test ratio appears in the current assets section of the balance sheet.

The Allowance for uncollectible accounts currently has a credit balance of $900.After analyzing the accounts in the accounts receivable subsidiary ledger using the aging method,the company's management estimates that uncollectible accounts will be $15,000. -What will be the amount of Uncollectible account expense reported on the income statement?

At January 1,Davidson Services has the following balances: During the year,Davidson has $104,000 of credit sales,collections of $100,000,and write-offs of $1,400. Davidson records Uncollectible account expense at the end of the year using the percent-of-sales method,and applies a rate of 1.1%,based on past history. - After the year-end entry to adjust the Uncollectible accounts expense,what is the ending balance in the Uncollectible accounts expense?

When a business discounts a note receivable to a bank or financial broker,the business will generally receive either more or less than the maturity value of the note.

The income statement approach computes uncollectible accounts expense by analyzing accounts receivable.

The aging method is a balance sheet approach of estimating uncollectible accounts.