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Exam 9: Receivables

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Question 21

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Notes Receivable and Accounts Receivable can also be called trade receivables.

A) True
B) False

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Question 22

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Allowance for Doubtful Accounts is a liability account.

A) True
B) False

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Question 23

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When using the estimate based on sales method, the entry to record uncollectible accounts expense includes a credit to the Accounts Receivable account.

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.

The interest on a 6%, 60-day note for $5,000 is $300.

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

Using the allowance method of accounting for uncollectible receivables, the entry to reinstate a specific receivable previously written off would include a

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

Other than accounts receivable and notes receivable, name other receivables that might be included in the general ledger.

A $6,000, 60-day, 12% note recorded on November 21 is not paid by the maker at maturity. The journal entry to recognize this event is

Fellows Corporation has determined that the $2,700 accounts receivable due from Andrew Stevens is uncollectible. Compare the journal entry that is required under the direct write-off method to the journal entry that is required using the allowance method.

Journalize the following transactions (Assume a 360-day year when calculating interest.):

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

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

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.

The balance in Allowance for Doubtful Accounts will directly impact the end of period adjustment for the bad debt expense when using which of the following methods?

On August 1, Kim Company accepted a 90-day note receivable as payment for services provided to Hsu Company. The terms of the note were $20,000 face value and 6% interest. On October 30, the journal entry to record the collection of the note should include a

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

The collection of an account that had been previously written off under the allowance method of accounting for uncollectibles

The accounts receivables turnover ratio is computed by dividing total gross sales by the average net receivables during the year.