©SIRJOEL EXAM SOLUTIONS
12/3/2024 11:27AM
Financial Accounting Exam #2 Questions
With Correct Answers
When a company provides services on account, which of the following accounts is debited? -
answer✔Accounts Receivable
Which of the following transactions would result in an account receivable? - answer✔Providing
services to customers on account.
The amount of cash owed to the company by its customers from the sale of products or services
on account is known as: - answer✔Accounts Receivable.
A sales discount is recorded by the seller as a(n): - answer✔Contra revenue.
On January 18, a company provides services to a customer for $500 and offers the customer
terms 2/10, n/30. Which of the following would be recorded when the customer remits payment
on January 25? - answer✔Debit Sales Discount for $10.
Which of the following refers to the seller reducing the customer's balance owed because of
some deficiency in the company's product or service? - answer✔Sales Allowance.
, ©SIRJOEL EXAM SOLUTIONS
12/3/2024 11:27AM
On August 4, Sanders provides services to Frederickson for $5,000, terms 3/10, n/30.
Frederickson pays for the services on August 12. What amount would Sanders record as revenue
on August 4? - answer✔$5,000.
On August 4, Sanders provides services to Frederickson for $5,000, terms 3/10, n/30.
Frederickson pays for the services on August 12. What is the amount of net revenues (total
revenue minus sales discounts) as of August 12? - answer✔$4,850.
The entry to record the estimate for uncollectible accounts includes: - answer✔A debit to Bad
Debt Expense.
Under the allowance method for uncollectible accounts, the balance of Allowance for
Uncollectible Accounts increases when: - answer✔Future bad debts are estimated.
Schmidt Company's Accounts Receivable balance is $100,000, its adjusted balance in Allowance
for Uncollectible Accounts is $4,000, and its bad debt expense is $3,800. The net amount of
accounts receivable is: - answer✔$96,000.
At the end of its first year of operations, a company establishes an allowance for future
uncollectible accounts for $5,600. At what amount would bad debt expense be reported in the
current year's income statement? - answer✔$5,600.
If a company uses the allowance method of accounting for uncollectible accounts and writes off
a specific account: - answer✔Net accounts receivable do not change
, ©SIRJOEL EXAM SOLUTIONS
12/3/2024 11:27AM
If a company uses the allowance method of accounting for uncollectible accounts and collects
cash on an account receivable previously written off: - answer✔There is no change in total assets
The effect of writing off a specific account receivable is: - answer✔A reduction in the Allowance
for Uncollectible Accounts
On December 31, the Accounts Receivable ending balance is $80,000. Assume that the
unadjusted balance of Allowance for Uncollectible Accounts is a debit of $500 and that the
company estimates 7% of the accounts receivable will not be collected. The amount of bad debt
expense recorded on December 31 will be: - answer✔$6,100
On December 31, the Accounts Receivable ending balance is $80,000. Assume that the
unadjusted balance of Allowance for Uncollectible Accounts is a credit of $500 and that the
company estimates 7% of the accounts receivable will not be collected. The amount of bad debt
expense recorded on December 31 will be: - answer✔$5,100
Assuming the balance of Allowance for Uncollectible Accounts is $3,000 (credit) before
adjustment, which of the following would be recorded in the year-end adjusting entry? -
answer✔Debit Bad Debt Expense for $14,000
Suppose the balance of the allowance for uncollectible accounts at the end of the current year is
$800 (credit) before any adjustment entry. The company estimates future uncollectible accounts
to be $5,600. At what amount would bad debt expense be reported in the current year's income
statement? - answer✔$4,800
12/3/2024 11:27AM
Financial Accounting Exam #2 Questions
With Correct Answers
When a company provides services on account, which of the following accounts is debited? -
answer✔Accounts Receivable
Which of the following transactions would result in an account receivable? - answer✔Providing
services to customers on account.
The amount of cash owed to the company by its customers from the sale of products or services
on account is known as: - answer✔Accounts Receivable.
A sales discount is recorded by the seller as a(n): - answer✔Contra revenue.
On January 18, a company provides services to a customer for $500 and offers the customer
terms 2/10, n/30. Which of the following would be recorded when the customer remits payment
on January 25? - answer✔Debit Sales Discount for $10.
Which of the following refers to the seller reducing the customer's balance owed because of
some deficiency in the company's product or service? - answer✔Sales Allowance.
, ©SIRJOEL EXAM SOLUTIONS
12/3/2024 11:27AM
On August 4, Sanders provides services to Frederickson for $5,000, terms 3/10, n/30.
Frederickson pays for the services on August 12. What amount would Sanders record as revenue
on August 4? - answer✔$5,000.
On August 4, Sanders provides services to Frederickson for $5,000, terms 3/10, n/30.
Frederickson pays for the services on August 12. What is the amount of net revenues (total
revenue minus sales discounts) as of August 12? - answer✔$4,850.
The entry to record the estimate for uncollectible accounts includes: - answer✔A debit to Bad
Debt Expense.
Under the allowance method for uncollectible accounts, the balance of Allowance for
Uncollectible Accounts increases when: - answer✔Future bad debts are estimated.
Schmidt Company's Accounts Receivable balance is $100,000, its adjusted balance in Allowance
for Uncollectible Accounts is $4,000, and its bad debt expense is $3,800. The net amount of
accounts receivable is: - answer✔$96,000.
At the end of its first year of operations, a company establishes an allowance for future
uncollectible accounts for $5,600. At what amount would bad debt expense be reported in the
current year's income statement? - answer✔$5,600.
If a company uses the allowance method of accounting for uncollectible accounts and writes off
a specific account: - answer✔Net accounts receivable do not change
, ©SIRJOEL EXAM SOLUTIONS
12/3/2024 11:27AM
If a company uses the allowance method of accounting for uncollectible accounts and collects
cash on an account receivable previously written off: - answer✔There is no change in total assets
The effect of writing off a specific account receivable is: - answer✔A reduction in the Allowance
for Uncollectible Accounts
On December 31, the Accounts Receivable ending balance is $80,000. Assume that the
unadjusted balance of Allowance for Uncollectible Accounts is a debit of $500 and that the
company estimates 7% of the accounts receivable will not be collected. The amount of bad debt
expense recorded on December 31 will be: - answer✔$6,100
On December 31, the Accounts Receivable ending balance is $80,000. Assume that the
unadjusted balance of Allowance for Uncollectible Accounts is a credit of $500 and that the
company estimates 7% of the accounts receivable will not be collected. The amount of bad debt
expense recorded on December 31 will be: - answer✔$5,100
Assuming the balance of Allowance for Uncollectible Accounts is $3,000 (credit) before
adjustment, which of the following would be recorded in the year-end adjusting entry? -
answer✔Debit Bad Debt Expense for $14,000
Suppose the balance of the allowance for uncollectible accounts at the end of the current year is
$800 (credit) before any adjustment entry. The company estimates future uncollectible accounts
to be $5,600. At what amount would bad debt expense be reported in the current year's income
statement? - answer✔$4,800
