FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 8: Receivables

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 1

Essay

Review LaterAdd Note

Review Later

At the end of the current year,Accounts Receivable has a balance of $700,000; Allowance for Doubtful Accounts has a credit balance of $5,500; and sales for the year total $3,500,000.Bad debt expense is estimated at 1 / 2 of 1% of net 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.

Correct Answer

verified

Show Answer

Question 2

Essay

Review LaterAdd Note

Review Later

On the basis of the following data related to assets due within one year for Webb Co.,prepare a partial balance sheet in good form at December 31.Show total current assets.

Correct Answer

verified

Show Answer

Question 3

Multiple Choice

Review LaterAdd Note

The maturity value of a $40,000,9%,40-day note receivable dated July 3 is

At the end of a period (before adjustment),Allowance for Doubtful Accounts has a debit balance of $500.Credit sales for the period total $800,000.If bad debt expense is estimated at 1% of credit sales,the amount of bad debt expense to be recorded in the adjusting entry is $8,500.

Discuss the (a)focus and (b)financial statement emphasis of the percent of sales and the analysis of receivables methods of estimating bad debts.

Dalton Company uses the allowance method to account for uncollectible receivables.Dalton has determined that the Irish Company account is uncollectible.To write off this account,Dalton should debit

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

In accounting for uncollectible receivables,the balance in Allowance for Doubtful Accounts will directly impact the amount of the adjustment when applying which method?

A disadvantage of factoring is that the company selling its receivables immediately receives cash.

When accounting for uncollectible receivables and using the percentage of sales method,the matching principle is violated.

​Which statement is not true?

Journalize the following transactions in the accounts of Simmons Company: ​ Mar.1 Received a $60,000,60-day,6% note dated March 1 from Bynum Company on account. Mar.18 Received a $25,000,60-day,9% note dated March 18 from Solo Company on account. Apr.30 The note dated March 1 from Bynum Company is dishonored,and the customer's account is charged for the note,including interest. May 17 The note dated March 18 from Solo Company is dishonored,and the customer's account is charged for the note,including interest. July 29 Cash is received for the amount due on the dishonored note dated March 1 plus interest for 90 days at 8% on the total amount debited to Bynum Company on April 30. Aug.23 Wrote off against the allowance account the amount charged to Solo Company on May 17 for the dishonored note dated March 18.

When the allowance method for accounting for uncollectible receivables is used,net income is reduced when a specific receivable is written off.

The amount of the promissory note plus the interest earned on the due date is called the

At the end of the current year,Accounts Receivable has a balance of $90,000; Allowance for Doubtful Accounts has a credit balance of $850; and sales for the year total $300,000.Bad debt expense is estimated at 2.5% of sales. ​ Determine (a)the amount of the adjusting entry for uncollectible accounts; (b)the adjusted balances of Accounts Receivable,Allowance for Doubtful Accounts,and Bad Debt Expense; and (c)the net realizable value of accounts receivable.

Allowance for Doubtful Accounts is classified as a(n) ______ account and has a normal ______ balance. ​

Indications that an account may be uncollectible include all of the following except

Generally accepted accounting principles do not normally allow the use of the direct write-off method of accounting for uncollectible accounts.

The direct write-off method records bad debt expense when an account is determined to be uncollectible.​

Journalize the following transactions using the allowance method of accounting for uncollectible receivables. ​ April 1 Sold merchandise on account to Jim Dobbs,$7,200.The cost of the merchandise is $5,400. ​ June 10 Received payment for one-third of the receivable from Jim Dobbs and wrote off the remainder. ​ Oct.11 Reinstated the account of Jim Dobbs and received cash in full payment.