Question 1

The percent-of-sales method for computing uncollectible accounts:

Accepted Answer

A) computes Uncollectible-Account Expense as a percent of accounts receivable. 
B) takes a balance sheet approach. 
C) employs the expense recognition (matching)concept. 
D) will result in the same amount of estimated Uncollectible-Accounts Expense as the aging-of-receivables method. 
A) computes Uncollectible-Account Expense as a percent of accounts receivable. 
B) takes a balance sheet approach. 
C) employs the expense recognition (matching)concept. 
D) will result in the same amount of estimated Uncollectible-Accounts Expense as the aging-of-receivables method.

Question 2

A debtor and a creditor record the same note,respectively,as a:

Accepted Answer

A) note receivable and note payable. 
B) note receivable and account receivable. 
C) note payable and note receivable. 
D) note payable and account payable. 
A) note receivable and note payable. 
B) note receivable and account receivable. 
C) note payable and note receivable. 
D) note payable and account payable.

Question 3

On December 1,the Youngstown Company accepted a $8,000 note in settlement of an overdue Accounts Receivable.The note bears 8% interest for 3 months.The Youngstown Company has a year end of December 31.
Required:
Prepare the journal entries to record the (1)transaction on December 1, (2)the accrued interest at December 31,and (3)the collection of the note on March 1.Round any amounts to the nearest dollar.Omit explanations.

Accepted Answer

The answer of On December 1,the Youngstown Company accepted a...

Question 4

Accounts (trade)receivable are amounts to be collected from customers from the sale of goods or services.

Accepted Answer

A) True 
 B)False

Question 5

Journalize the following transactions for The Technology Store.The Technology Store uses the direct write-off method of accounting for uncollectible receivables.Ignore Cost of Goods Sold.Explanations are not required.

Accepted Answer

The answer of Journalize the following transactions for The Technology...

Question 6

On July 8,ABC Plumbing provided services of $7,500 on account to First Bank,with terms 3/10,n/30.On July 28,ABC received the full amount due from First Bank.
Prepare the journal entries for ABC Plumbing using the gross method.Omit explanations.

Accepted Answer

The answer of On July 8,ABC Plumbing provided services of...

Question 7

A company has net credit sales of $2,060,000,a beginning balance of net receivables of $207,000,and an ending balance of net receivables of $246,000.What is the company's days' sales outstanding? (Round any intermediary calculations to two decimal places and your final answer to the nearest day. )

Accepted Answer

A) 9 days 
B) 37 days 
C) 40 days 
D) 44 days 
A) 9 days 
B) 37 days 
C) 40 days 
D) 44 days

Question 8

Generally Accepted Accounting Principles (GAAP)allow companies to use either the direct write-off method or the allowance method to determine Uncollectible-Account Expense.

Accepted Answer

A) True 
 B)False

Question 9

At the end of the year,Smith Company has the following information available:   The company uses the percent-of-sales method to estimate uncollectible accounts and has not prepared the year-end adjusting entry for Uncollectible-Account Expense.In the prior year,uncollectible accounts were estimated at 1% of credit sales.What action should Smith Company take in regards to uncollectible accounts at the end of the current year?

Accepted Answer

A) increase the percentage in the percent-of-sales method 
B) reexamine credit policies,especially the extension of credit 
C) change to the direct write-off method 
D) A and B 
A) increase the percentage in the percent-of-sales method 
B) reexamine credit policies,especially the extension of credit 
C) change to the direct write-off method 
D) A and B

Question 10

Accounts receivable represents a form of extending credit which requires customers to sign a promise to pay the business a definite sum at the maturity date,plus interest.

Accepted Answer

A) True 
 B)False

Question 11

The balance in the Allowance for Uncollectible Accounts is considered prior to the year-end adjustment under:

Accepted Answer

A) the direct write-off method. 
B) the percent-of-sales method. 
C) the aging-of-receivables method. 
D) both the percent-of-sales and aging-of-receivables methods. 
A) the direct write-off method. 
B) the percent-of-sales method. 
C) the aging-of-receivables method. 
D) both the percent-of-sales and aging-of-receivables methods.

Question 12

The general ledger has a separate account receivable for each customer.

Accepted Answer

A) True 
 B)False

Question 13

The aging-of-receivables method for estimating uncollectible accounts:

Accepted Answer

A) results in an immediate write-off of receivables that are more than 90 days past due. 
B) focuses on the amount of receivables that will not be collected. 
C) uses a balance sheet approach. 
D) B and C. 
A) results in an immediate write-off of receivables that are more than 90 days past due. 
B) focuses on the amount of receivables that will not be collected. 
C) uses a balance sheet approach. 
D) B and C.

Question 14

Days' sales in receivables is also called:

Accepted Answer

A) days' sales outstanding 
B) collection period 
C) accounts receivable turnover 
D) A and B 
A) days' sales outstanding 
B) collection period 
C) accounts receivable turnover 
D) A and B

Question 15

Rockford Moving Company has calculated the following ratios:   Did the company's liquidity improve in 2019?

Accepted Answer

A) No. 
B) Yes. 
C) There is conflicting information.One ratio improved and two ratios did not improve. 
D) There is not enough information to assess. 
A) No. 
B) Yes. 
C) There is conflicting information.One ratio improved and two ratios did not improve. 
D) There is not enough information to assess.

Question 16

One way the risk of not collecting receivables can be managed is:

Accepted Answer

A) have all customers pay by check. 
B) separate cash-handling duties from record-keeping duties. 
C) separate cash-handling from the mailroom. 
D) have an imprest petty cash fund. 
A) have all customers pay by check. 
B) separate cash-handling duties from record-keeping duties. 
C) separate cash-handling from the mailroom. 
D) have an imprest petty cash fund.

Question 17

The following account balances were extracted from the accounting records of Thomas Corporation at the end of the year:   What is the net realizable value of the accounts receivable?

Accepted Answer

A) $1,068,000 
B) $1,105,000 
C) $1,142,000 
D) $1,165,000 
A) $1,068,000 
B) $1,105,000 
C) $1,142,000 
D) $1,165,000

Question 18

Following are key terms relating to notes receivable,as well as a list of definitions.
A.Creditor
B.Debtor
C.Interest
D.Maturity date
E.Maturity value
F.Principal
G.Term
   Required: Place the appropriate letter (A-G)on the line in front of the statement describing the term.

Accepted Answer

1.F,2.A,3.

Question 19

A measure of the ability of an entity to pay all of its current liabilities if they came due immediately is the:

Accepted Answer

A) debt ratio. 
B) quick ratio. 
C) liquidity ratio. 
D) accounts receivable turnover. 
A) debt ratio. 
B) quick ratio. 
C) liquidity ratio. 
D) accounts receivable turnover.

Question 20

When compared to the current ratio,the quick ratio is a less stringent measure of a company's ability to pay its current liabilities.

Accepted Answer

A) True 
 B)False

The percent-of-sales method for computing uncollectible accounts:

A debtor and a creditor record the same note,respectively,as a:

Accounts (trade)receivable are amounts to be collected from customers from the sale of goods or services.

Journalize the following transactions for The Technology Store.The Technology Store uses the direct write-off method of accounting for uncollectible receivables.Ignore Cost of Goods Sold.Explanations are not required.

On July 8,ABC Plumbing provided services of $7,500 on account to First Bank,with terms 3/10,n/30.On July 28,ABC received the full amount due from First Bank. Prepare the journal entries for ABC Plumbing using the gross method.Omit explanations.

A company has net credit sales of $2,060,000,a beginning balance of net receivables of $207,000,and an ending balance of net receivables of $246,000.What is the company's days' sales outstanding? (Round any intermediary calculations to two decimal places and your final answer to the nearest day. )

Generally Accepted Accounting Principles (GAAP)allow companies to use either the direct write-off method or the allowance method to determine Uncollectible-Account Expense.

Accounts receivable represents a form of extending credit which requires customers to sign a promise to pay the business a definite sum at the maturity date,plus interest.

The balance in the Allowance for Uncollectible Accounts is considered prior to the year-end adjustment under:

The general ledger has a separate account receivable for each customer.

The aging-of-receivables method for estimating uncollectible accounts:

Days' sales in receivables is also called:

Rockford Moving Company has calculated the following ratios: Did the company's liquidity improve in 2019?

One way the risk of not collecting receivables can be managed is:

The following account balances were extracted from the accounting records of Thomas Corporation at the end of the year: What is the net realizable value of the accounts receivable?

Following are key terms relating to notes receivable,as well as a list of definitions. A.Creditor B.Debtor C.Interest D.Maturity date E.Maturity value F.Principal G.Term Required: Place the appropriate letter (A-G)on the line in front of the statement describing the term.

A measure of the ability of an entity to pay all of its current liabilities if they came due immediately is the:

When compared to the current ratio,the quick ratio is a less stringent measure of a company's ability to pay its current liabilities.

The Financial Statements

Transaction Analysis

Accrual Accounting Income

Internal Control Cash

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters

Exam 5: Receivables and Revenue

The percent-of-sales method for computing uncollectible accounts:

A debtor and a creditor record the same note,respectively,as a:

Accounts (trade)receivable are amounts to be collected from customers from the sale of goods or services.

Journalize the following transactions for The Technology Store.The Technology Store uses the direct write-off method of accounting for uncollectible receivables.Ignore Cost of Goods Sold.Explanations are not required.

On July 8,ABC Plumbing provided services of $7,500 on account to First Bank,with terms 3/10,n/30.On July 28,ABC received the full amount due from First Bank. Prepare the journal entries for ABC Plumbing using the gross method.Omit explanations.

A company has net credit sales of $2,060,000,a beginning balance of net receivables of $207,000,and an ending balance of net receivables of $246,000.What is the company's days' sales outstanding? (Round any intermediary calculations to two decimal places and your final answer to the nearest day. )

Generally Accepted Accounting Principles (GAAP)allow companies to use either the direct write-off method or the allowance method to determine Uncollectible-Account Expense.

Accounts receivable represents a form of extending credit which requires customers to sign a promise to pay the business a definite sum at the maturity date,plus interest.

The balance in the Allowance for Uncollectible Accounts is considered prior to the year-end adjustment under:

The general ledger has a separate account receivable for each customer.

The aging-of-receivables method for estimating uncollectible accounts:

Days' sales in receivables is also called:

Rockford Moving Company has calculated the following ratios: Did the company's liquidity improve in 2019?

One way the risk of not collecting receivables can be managed is:

The following account balances were extracted from the accounting records of Thomas Corporation at the end of the year: What is the net realizable value of the accounts receivable?

Following are key terms relating to notes receivable,as well as a list of definitions. A.Creditor B.Debtor C.Interest D.Maturity date E.Maturity value F.Principal G.Term Required: Place the appropriate letter (A-G)on the line in front of the statement describing the term.

A measure of the ability of an entity to pay all of its current liabilities if they came due immediately is the:

When compared to the current ratio,the quick ratio is a less stringent measure of a company's ability to pay its current liabilities.

The Financial Statements

Transaction Analysis

Accrual Accounting Income

Internal Control Cash

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters