The balance in Allowance for Doubtful Accounts will directly impact the end-of-p
ID: 2533235 • Letter: T
Question
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?
direct write-off method
allowance method based on aging the receivables
accrual method
declining value method
Indications that an account may be uncollectible include all of the following except
the customer files for bankruptcy
the customer is making small but regular payments
the customer closes its business
the customer cannot be located
The operating expense recorded from uncollectible receivables can be called all of the following except
bad debt expense
accounts receivable
doubtful accounts expense
uncollectible accounts expense
Two methods of accounting for uncollectible accounts are the
allowance method and the accrual method
direct write-off method and the accrual method
direct write-off method and the allowance method
allowance method and the net realizable method
If the allowance method of accounting for uncollectible receivables is used, what general ledger account is debited to write off a customer's account as uncollectible?
Interest Expense
Accounts Receivable
Uncollectible Accounts Expense
Allowance for Doubtful Accounts
After the accounts are adjusted and closed at the end of the fiscal year, Accounts Receivable has a balance of $340,000 and Allowance for Doubtful Accounts has a balance of $51,000. What is the net realizable value of the accounts receivable?
$391,000
$51,000
$289,000
$340,000
Explanation / Answer
1) The balance in Allowance for Doubtful Accounts will directly impact the end-of-period adjustment for the bad debt expense when using (b) allowance method based on aging the receivables.
2) Indications that an account may be uncollectible include all of the following except (b) the customer is making small but regular payments.
3) The operating expense recorded from uncollectible receivables can be called all of the following except (b) accounts receivable.
4) Two methods of acounting for uncollectible accounts are the (c) diect write-off method and the allowance method.
5) If the allowance method of accounting for uncollectible receivables is used, the (d) allowance for doubtful accounts is debited to write off a customer's account as uncollectible.
6) The net realizable value of the accounts receivable is (c) $289,000 by deducting the allowance for doubtful accounts of $51,000 from balance of accounts receivable of $340,000.
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