1. After aging the receivables, Tim's toys estimates that $900 will not be collected, and the Allowance accounts has a debit balance of $325. The adjusting entry would be for: a. $575 b. $900 c. $1,225 d. $325
2. After aging the Accounts Receivables, it is estimates that $2,450 will not be collected, and the Allowance accounts has an existing debit balance of $300. If Accounts Receivable is $107,000, the net receivables would be for: a. $107,000 b. $106,900 c. $104,550 d. $104,250
3. A detailed analysis of Accounts Receivable to determine how long each account has been outstanding is called: a. analyzing the Accounts Receivable b. aging the uncollectible accounts c. aging the Accounts Receivable d. taking a oercentage of sales on account
4. Empire has a credit balance of $750 in its Allowance for Doubtful Accounts, The balance in the Accounts Receivable account is $80,500, with $2,415 estimated to be uncollectible after aging the accounts. Under the balance sheet approach, the debit to Bad Debt Expense will be: a. $2,415 b. $3,165 c. $1,665 d. $750
5. Gross Accounts Receivables 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, and an aging of the recivables indicates $1,200 is doubtful. Under the income statement approach, the Bad Debts Expense for the year is: a. $1,000 b. $3,000 c. $2,800 d. $1,200
6. A written promise to pay a certain sum of money to another person or company is a: a. Promissory Accounts Payable b. Promissory Note Payable c. Promissory Accounts Receivable d. Promissory Note Receivable
7. Unlimited materials sold goods for $2,000 plus 6% sales tax to a charge customer, terms n/30. Which entry is required to record this transaction? a. Debit Accounts Receivable $2,120; credit sales tax payable $120; credit sales for $2,000 b. Debit Cash for $2,000; credit sales $2,000 c. Debit Accounts receivable $2,000; credit sales $2,000 d. Debit Accounts receivable $2,120; sales $2,120
8. Sue’s jewelry sold 20 necklace for $25 each to a credit customers. The invoice included a 6% sales tax and payment terms of 2/10, n/30. Five necklaces were returned prior to payment. The entry to record the original sale would include a: a. Debit to accounts receivable for $530 b. Debit to accounts receivable for $500 c. Debit to sales for $530 d. Debit to sales for $500
9. Sue’s jewelry sold 30 necklaces for $25 each to a credit customer. The invoice included a 6% sales tax and payment terms of 2/10, n/30. Five necklaces were returned prior to payment. The entry to record the return would include a: a. Debit to sales returns and allowances for $132.50 b. Debit to sales returns and allowances for $125.00 c. Credit to sales tax payable for $7.50 d. Debit to accounts receivable for $132.50
10. A collected payment from a credit customer will be recorded with a: a. Credit to an asset account b. Credit to a liability account c. Credit to capital d. None of the above
11. Sue’s jewelry sold 30 necklaces for $25 each to a credit customer. The invoice included a 6% sales tax and payment terms of 2/10, n/30. Five necklaces were returned prior to payment. The entry to record the payment would include a: a. Credit to cash for $625.00 b. Credit t0 cash for $662.50 c. Credit to accounts receivable for $625.00 d. Credit to accounts receivable for $662.50
12. Determine the amount to be paid within the discount period for a previous sale with an invoice price of $10,000, subject to credit terms of 1/10, n/30 a. $5,000 b. $9,500 c. $10,000 d. $9,000
13. If a display rack was purchased for the store, which of the following accounts would be increased? a. Store equipment b. Purchases c. Cash d. Capital
14. Heidi’s accessories bought 50 necklaces for $10 each on account. The invoice included a 6% sales tax and payment terms of 2/10, n/30. Five necklace were returned prior to payment. The entry to record the purchase would include a: a. Debit to accounts payable for $530 b. Debit to accounts payable for $500 c. Debit to purchase for $530 d. Debit to purchases for $500
15. Returned merchandise under the periodic inventory method. This will be recorded with a: a. Debit to accounts payable and a credit to purchase returns and allowances b. Debit to merchandise inventory and a credit to purchase c. Credit to accounts payable and a debit to merchandise inventory d. Debit to accounts payable and a credit to merchandise inventory
