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Exam 7: Cash and Receivables

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Question 51

Multiple Choice

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Memorex Disks sells computer disk drives with right-of-return privileges.Returns are material and reasonably predictable.Memorex should:

A) Not record sales until the right to return has expired.
B) Record an allowance for sales returns in the year of the sale.
C) Debit sales returns in the period of the return.
D) Debit sales in the period of the return.

E) None of the above
F) A) and C)

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Question 52

True/False

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If a long-term noninterest-bearing note is received in exchange for merchandise sold,the amount of sales revenue recognized will be greater than the amount of the note.

A) True
B) False

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Question 53

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What entry would Oswego make on April 23,assuming the customer made the correct payment on that date?

The following information pertains to Jacobsen Co.'s accounts receivable at December 31,2016: During 2016,Jacobsen wrote off $18,000 in receivables and recovered $6,000 that had been written off in prior years.Jacobsen's December 31,2015,allowance for uncollectible accounts was $40,000.Under the aging method,what amount of allowance for uncollectible accounts should Jacobsen report at December 31,2016?

If Frasquita accrued interest of $15,000 on the note in its 2016 year-end financial statements,what amount would it record the equipment on its 6/30/2016 balance sheet?

What is the correct entry to record the note?

In a bank reconciliation,adjustments to the bank balance could include adding deposits in transit and deducting bank service charges.

Use the following to answer questions The following information is taken from the 2013 annual report to shareholders of Hewlett-Packard (HP)Co. -What kind of account is the provision for doubtful accounts in HP's financial statements?

A company's investment in receivables is influenced by several variables,including:

The following information relates to Halloran Co.'s accounts receivable for 2016: What amount should Halloran report for accounts receivable,before allowances,at December 31,2016?

Calistoga's adjusted allowance for uncollectible accounts at December 31,2016,is:

Last year,Simpson Company had a receivables turnover ratio of 12.Homer,Simpson's president,was delighted when the ratio went to 18 for this year.This year,Simpson's long-standing credit terms of net 30 were changed to net 10.Should Homer be happy? Explain.

The petty cash fund of Western Glass Company contained the following items on November 30,2016: The petty cash fund was established on November 1,2016,with a transfer of $250 from cash to the petty cash account. Required: Prepare the journal entries to establish the petty cash account and to replenish the fund at the end of November.

What is the correct entry for Flores on November 17,assuming the correct payment was received on that date?

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms.Match each phrase with the number for the correct term.

Which of the following is recorded by a credit to accounts receivable?

A company uses the allowance method to account for bad debts.What is the effect on each of the following accounts of the collection of an account previously written off?

What entry would Oswego make on April 12?

A note receivable Mild Max Cycles discounted with recourse was dishonored on its maturity date.Mild Max would debit:

In Dinty's adjusting entry for bad debts at year-end,which of these would be included?