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Exam 9: Receivables

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Question 51

Multiple Choice

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Match each description to the appropriate term (a-i) . -Records bad debt expense only when a specific customer's account is deemed worthless

A) Accounts receivable turnover
B) Net realizable value
C) Accounts receivable
D) Aging the receivables
E) Receivables
F) Direct write-off method
G) Allowance for doubtful accounts
H) Bad debt expense
I) Notes receivable

J) E) and G)
K) E) and F)

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Question 52

Multiple Choice

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A debit balance in Allowance for Doubtful Accounts

A) is the normal balance for that account
B) indicates that actual bad debt write-offs have been less than what was estimated
C) cannot occur if the percentage of receivables method of estimating bad debts is used
D) indicates that actual bad debt write-offs have exceeded previous provisions for bad debts

E) A) and B)
F) B) and D)

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Question 53

Multiple Choice

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If the direct write-off method of accounting for uncollectible receivables is used,what general ledger account is debited to write off a customer's account as uncollectible?

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

Watson Co.issued a 60-day,8% note for $18,000,dated April 5,to Laker Company on account. (Assume a 360-day year when calculating interest.)

The receivable that is usually evidenced by a formal,written instrument of credit is a (n)

Match each description to the appropriate term (a-i) . -The difference between accounts receivable and allowance for doubtful accounts

Determine the amount to be added to Allowance for Doubtful Accounts in each of the following cases and indicate the ending balance in each case.

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

Receivables not currently collectible are reported in the Investments section of the balance sheet.

Discuss the similarities and differences between accounts receivable,notes receivable,and other receivables.

The term "receivables" includes all

On June 30 (the end of the period),Brown Company has a credit balance of $2,275 in Allowance for Doubtful Accounts.An evaluation of accounts receivable indicates that the proper balance should be $30,025.Journalize the appropriate adjusting entry.

Allowance for Doubtful Accounts has a debit balance of $2,500 at the end of the year (before adjustment) ,and bad debt expense is estimated at 4% of credit sales.If credit sales are $800,000,the amount of the adjusting entry to record the estimate of the uncollectible accounts

A company may sell its receivables,but it still assumes the risk of uncollectible accounts.

Receivables that are expected to be collected in cash in 18 months or less are reported in the Current assets section of the balance sheet.

If the allowance method of accounting for uncollectible receivables is used,what general ledger account is credited to write off a customer's account as uncollectible?

Journalize the following transactions using the direct write-off method of accounting for uncollectible receivables.​Apr.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.

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

Match each description to the appropriate term (a-i) . -Measures how frequently during the year accounts receivable are being turned into cash