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

Answer 1

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.