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Exam 8: Receivables

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Question 61

True/False

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In computing the maturity date of a note,the date the note is issued is included but the due date is omitted.

A) True
B) False

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Question 62

Multiple Choice

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If collection of an other receivable is expected beyond one year,it is classified as​ a

A) noncurrent asset and reported under Other Receivables
B) current asset and reported under Other Receivables
C) current asset and reported under Investments
D) noncurrent asset and reported under Investments

E) B) and C)
F) None of the above

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Question 63

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​No allowance account is used with the direct write-off method.

Current assets are usually listed in order

Harper Company lends Hewell Company $40,000 on March 1,accepting a four-month,6% interest note.Harper Company prepares financial statements on March 31.What adjusting entry should be made before the financial statements can be prepared?

On the balance sheet after adjusting entries are made,the amount shown for the Allowance for Doubtful Accounts is equal to the

When using the analysis of receivables method for estimating uncollectible receivables,the amount computed in the analysis is usually the amount that would be recorded in the end-of-period adjusting entry.

For a business that uses the allowance method of accounting for uncollectible receivables:

Discount Mart utilizes the allowance method of accounting for uncollectible receivables.On December 12 the company receives a $550 check from Chad Thomas in settlement of Thomas's $1,100 outstanding accounts receivable.Due to Thomas's failing health he is closing his company and is expecting to make no further payments to Discount Mart.Journalize this declaration.

At the end of a period (before adjustment),Allowance for Doubtful Accounts has a credit balance of $250.The credit sales for the period total $500,000.If the company estimates uncollectible accounts at 1% of credit sales,the amount of bad debt expense to be recorded in an adjusting entry is $4,750.

When using the percent of sales method of estimating uncollectibles,the entry to record bad debt expense includes a credit to Accounts Receivable.

Sunshine Service Center received a 120-day,6% note for $40,000,dated April 12 from a customer on account.

When a company receives an interest-bearing note receivable,it will

When a company uses the allowance method of accounting for uncollectible receivables,which entry would not be found in the general journal?

Which of the following receivables would not be classified as an "other receivable"?

A note receivable due in 18 months is listed on the balance sheet under the caption

The allowance method of estimating uncollectible accounts receivable based on an analysis of receivables shows that $640 of accounts receivable are uncollectible.The Allowance for Doubtful Accounts has a debit balance of $110.The adjusting entry at the end of the year will include a credit to Allowance for Doubtful Accounts in the amount of:

Journalize the following transactions using the direct write-off 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.

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? ​

The maturity value of a 12%,60-day note for $5,000 is $5,600.