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Exam 8: Receivables

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Question 1

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What is the type of account and normal balance of Allowance for Doubtful Accounts?

A) Contra asset,credit
B) Asset,debit
C) Asset,credit
D) Contra asset,debit

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Question 2

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At the end of the current year,Accounts Receivable has a balance of $675,000;Allowance for Doubtful Accounts has a debit balance of $5,400;and net sales for the year total $3,000,000.An analysis of receivables indicates the uncollectible receivables are estimated to be $45,000. Determine (a)the amount of the adjusting entry for bad debt expense; (b)the adjusted balances of Accounts Receivable,Allowance of Doubtful Accounts;and Bad Debt Expense;and (c)the net realizable value of accounts receivable.

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Question 3

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When referring to a note receivable or promissory note

Allowance for Doubtful Accounts has a credit balance of $1,300 at the end of the year (before adjustment) .The company prepares an analysis of customers' accounts to estimate the amount of uncollectible accounts of $41,900.Which of the following adjusting entries would be made to record the Bad Debt Expense for the year?

The amount of a promissory note is called the

Stephanie Roe utilizes the direct write-off method of accounting for uncollectible receivables.On September 15th she is notified by the attorneys for Jacob Marley that Jacob Marley is bankrupt and no cash is expected in the liquidation of Jacob Marley.Write off the $675 of accounts receivable due Jacob Marley.

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.

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

The party promising to pay a note at maturity is the maker.

Discuss the (1)focus and (2)financial statement emphasis of (a)the percent of sales and (b)the analysis of receivables methods of estimating bad debts.

On June 30th (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.

Trade receivables occur when two companies trade or exchange notes receivables.

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

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

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

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

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

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

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

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