Question 1

What would be the basis for the following entry on a firm's records?   Bad Debt Expense 150 Accounts Receivable 150\begin{array} { | c | l | } \hline 	ext { Bad Debt Expense } & 150 \\hline 	ext { Accounts Receivable } & 150 \\hline\end{array} Bad Debt Expense  Accounts Receivable ​150150​​

Accepted Answer

A)  The firm is using the direct write-off method.
B)  The firm is writing off an uncollectible account.
C)  The firm is not using the allowance method for writing off accounts.
D)  All of these answers are correct. E) A) and B)
F) A) and C)

Question 2

Use the account code numbers to identify how the following transactions would be journalized.
[1]Cash
[2]Accounts Receivable
[3]Allowance for Doubtful Accounts
[4]Bad Debts Expense,
[5]Bad Debts Recovered
-Increase the allowance for the estimated bad debts using the percentage of receivables.
Debit account ________ Credit account ________

Accepted Answer

The answer of Use the account code numbers to identify...

Question 3

The net realizable value of a company's Accounts Receivables is:

Accepted Answer

A)  increased at the time of a specific write-off.
B)  decreased at the time of a specific write-off.
C)  unchanged at the time of a specific write-off.
D)  the guaranteed amount the company will collect from its customers.E) B) and D)
F) B) and C)

Question 4

For each of the following, identify in column 1 the category to which the account belongs, in column 2 the normal balance for the account, in column 3 the financial statement that the account in which the account balance is reported, and in column 4 the account's nature.
-$\begin{array} { | l | l | l | l | l | } 
\hline & \text { Column 1 } & \text { Column 2 } & \text { Column 3 } & \text { Column 4 } \
\hline \text { Cash } & & & & \
\hline
\end{array}$

Accepted Answer

The answer of For each of the following, identify in...

Question 5

What would be the basis for the following journal entry if it appears on Travis Company records? Travis uses the allowance method.   Allowance for Doubtful Accounts 150 Accounts Receivable -Tim Morgan 150\begin{array} { | c | l | } \hline 	ext { Allowance for Doubtful Accounts } & 150 \\hline 	ext { Accounts Receivable -Tim Morgan } & 150 \\hline\end{array} Allowance for Doubtful Accounts  Accounts Receivable -Tim Morgan ​150150​​

Accepted Answer

A)  The firm is estimating its uncollectible accounts.
B)  The firm is writing off a specific account.
C)  The firm is making a collection of a previously written-off account.
D)  It is a reversing entry. E) None of the above
F) A) and B)

Question 6

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?

Accepted Answer

A)  Bad Debts Expense
B)  Accounts Receivable
C)  Accounts Payable
D)  Bad Debts RecoveredE) B) and C)
F) A) and B)

Question 7

The balance sheet approach estimates a percentage of Accounts Receivable that is uncollectible.

Accepted Answer

A) True 
 B)False

Question 8

A notice was received from Mary,who is a customer,that she was bankrupt.The entry to write-off her balance of $1,250 would be:

Accepted Answer

A)     Allowance for Doubtful Accounts 1,250 Accounts Receivable/Mary 1,250\begin{array} { | c | l | } \hline 	ext { Allowance for Doubtful Accounts } & 1,250 \\hline 	ext { Accounts Receivable/Mary } & 1,250 \\hline\end{array} Allowance for Doubtful Accounts  Accounts Receivable/Mary ​1,2501,250​​ 
B)     Accounts Receivable/Mary 1,250 Bad Debt Expense 1,250\begin{array} { | c | l | } \hline 	ext { Accounts Receivable/Mary } & 1,250 \\hline 	ext { Bad Debt Expense } & 1,250 \\hline\end{array} Accounts Receivable/Mary  Bad Debt Expense ​1,2501,250​​ 
C)     Bad Debt Expense 1,250 Allowance for Doubtful Accounts 1,250\begin{array}{|l|lll|} \hline 	ext { Bad Debt Expense } & 1,250\\hline 	ext { Allowance for Doubtful Accounts } & 1,250\\hline \end{array} Bad Debt Expense  Allowance for Doubtful Accounts ​1,2501,250​​ 
D)  None of the above E) B) and C)
F) None of the above

Question 9

The Allowance for Doubtful accounts is shown on the income statement.

Accepted Answer

A) True 
 B)False

Question 10

In the direct write-off method,writing off an account causes:

Accepted Answer

A)  an increase in expense.
B)  an increase in Accounts Receivable.
C)  a decrease in the Allowance account.
D)  an increase in Liabilities.E) All of the above
F) A) and B)

Question 11

Using the income statement approach,the balance in Allowance for Doubtful Accounts is ignored.

Accepted Answer

A) True 
 B)False

Question 12

The Allowance for Doubtful Accounts is shown on the balance sheet as a contra-asset.

Accepted Answer

A) True 
 B)False

Question 13

The amount of Accounts Receivable a company estimates it will collect is the:

Accepted Answer

A)  Gross Accounts Receivable.
B)  Bad Debts Allowance.
C)  Net Realizable Value.
D)  Accounts Receivable Allowance.E) B) and D)
F) B) and C)

Question 14

Using the balance sheet approach,the balance in Allowance for Doubtful Accounts is taken into consideration when finding the adjustment.

Accepted Answer

A) True 
 B)False

Question 15

When all of the cash for an account previously written off under the direct write-off method is unexpectedly collected,the correct entry would be:

Accepted Answer

A)  debit Bad Debt Expense and credit Accounts Receivable.
B)  debit Accounts Receivable and credit Bad Debt Expense.
C)  debit Cash and credit Accounts Receivable.
D)  dependent on the period in which the cash was collected.E) A) and B)
F) All of the above

Question 16

What type of account is a Bad Debts Expense?

Accepted Answer

A)  Asset
B)  Contra-asset
C)  Expense
D)  LiabilityE) A) and D)
F) B) and C)

Question 17

A company is not able to reasonably estimate its bad debts expense.The method it may use is:

Accepted Answer

A)  net realizable value method.
B)  direct write-off method.
C)  aging method.
D)  income statement method.E) C) and D)
F) B) and D)

Question 18

Gross Accounts Receivable is $10,000.Allowance for Doubtful Accounts has a credit balance of $200.Net sales for the year are $150,000.In the past,2% of sales had proved uncollectible.What would be the adjusted balance of the Allowance account under the income statement approach?

Accepted Answer

A)  $3,200
B)  $2,800
C)  $1,400
D)  $3,000E) All of the above
F) A) and D)

Question 19

Prepare the adjusting journal entry of Bad Debts Expense from the following information using the income statement approach.
 $\begin{array}{llcc}
  \text {  Net Sales for the year} &\$475,000  \
 \text {Balance in the allowance account  } &900 \text {credit}\
 \text {Estimated percentage of sales uncollectible  } &2\%\
 \text { Estimated uncollectible accounts-aging } &\$2,500\
\end{array}$

Accepted Answer

The answer of Prepare the adjusting journal entry of Bad...

Question 20

Use the account code numbers to identify how the following transactions would be journalized.
[1]Cash
[2]Accounts Receivable
[3]Allowance for Doubtful Accounts
[4]Bad Debts Expense,
[5]Bad Debts Recovered
-Wrote off an account using the allowance method.
Debit account ________ Credit account ________

Accepted Answer

The answer of Use the account code numbers to identify...

Exam 13: Accounting for Bad Debts

The amount of Accounts Receivable a company estimates it will collect is the:

Correct Answer
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Correct Answer
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A notice was received from Mary,who is a customer,that she was bankrupt.The entry to write-off her balance of $1,250 would be:

Correct Answer
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The balance sheet approach estimates a percentage of Accounts Receivable that is uncollectible.

Correct Answer
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Correct Answer
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A company is not able to reasonably estimate its bad debts expense.The method it may use is:

Correct Answer
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What would be the basis for the following entry on a firm's records? $\begin{array} { | c | l | } \hline \text { Bad Debt Expense } & 150 \\\hline \text { Accounts Receivable } & 150 \\\hline\end{array}$

Correct Answer
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The Allowance for Doubtful Accounts is shown on the balance sheet as a contra-asset.

Correct Answer
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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?

Correct Answer
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Using the balance sheet approach,the balance in Allowance for Doubtful Accounts is taken into consideration when finding the adjustment.

Correct Answer
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The net realizable value of a company's Accounts Receivables is:

Correct Answer
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Using the income statement approach,the balance in Allowance for Doubtful Accounts is ignored.

Correct Answer
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Gross Accounts Receivable is $10,000.Allowance for Doubtful Accounts has a credit balance of $200.Net sales for the year are $150,000.In the past,2% of sales had proved uncollectible.What would be the adjusted balance of the Allowance account under the income statement approach?

Correct Answer
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The Allowance for Doubtful accounts is shown on the income statement.

Correct Answer
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Use the account code numbers to identify how the following transactions would be journalized. [1]Cash [2]Accounts Receivable [3]Allowance for Doubtful Accounts [4]Bad Debts Expense, [5]Bad Debts Recovered -Wrote off an account using the allowance method. Debit account Credit account

Correct Answer
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What type of account is a Bad Debts Expense?

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What would be the basis for the following journal entry if it appears on Travis Company records? Travis uses the allowance method. $\begin{array} { | c | l | } \hline \text { Allowance for Doubtful Accounts } & 150 \\\hline \text { Accounts Receivable -Tim Morgan } & 150 \\\hline\end{array}$

Correct Answer
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When all of the cash for an account previously written off under the direct write-off method is unexpectedly collected,the correct entry would be:

Correct Answer
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In the direct write-off method,writing off an account causes:

Correct Answer
verified

Exam 13: Accounting for Bad Debts

The amount of Accounts Receivable a company estimates it will collect is the:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A notice was received from Mary,who is a customer,that she was bankrupt.The entry to write-off her balance of $1,250 would be:

Correct AnswerverifiedShow Answer

The balance sheet approach estimates a percentage of Accounts Receivable that is uncollectible.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A company is not able to reasonably estimate its bad debts expense.The method it may use is:

Correct AnswerverifiedShow Answer

What would be the basis for the following entry on a firm's records? Bad Debt Expense 150 Accounts Receivable 150\begin{array} { | c | l | } \hline \text { Bad Debt Expense } & 150 \\\hline \text { Accounts Receivable } & 150 \\\hline\end{array} Bad Debt Expense Accounts Receivable ​150150​​

Correct AnswerverifiedShow Answer

The Allowance for Doubtful Accounts is shown on the balance sheet as a contra-asset.

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

Using the balance sheet approach,the balance in Allowance for Doubtful Accounts is taken into consideration when finding the adjustment.

Correct AnswerverifiedShow Answer

The net realizable value of a company's Accounts Receivables is:

Correct AnswerverifiedShow Answer

Using the income statement approach,the balance in Allowance for Doubtful Accounts is ignored.

Correct AnswerverifiedShow Answer

Gross Accounts Receivable is $10,000.Allowance for Doubtful Accounts has a credit balance of $200.Net sales for the year are $150,000.In the past,2% of sales had proved uncollectible.What would be the adjusted balance of the Allowance account under the income statement approach?

Correct AnswerverifiedShow Answer

The Allowance for Doubtful accounts is shown on the income statement.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

What type of account is a Bad Debts Expense?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

When all of the cash for an account previously written off under the direct write-off method is unexpectedly collected,the correct entry would be:

Correct AnswerverifiedShow Answer

In the direct write-off method,writing off an account causes:

Correct AnswerverifiedShow Answer

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What would be the basis for the following entry on a firm's records? $\begin{array} { | c | l | } \hline \text { Bad Debt Expense } & 150 \\\hline \text { Accounts Receivable } & 150 \\\hline\end{array}$

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