Accounting chapter 8 multiple choice Exam 44 Questions
with Verified Answers
What type of receivable is evidenced by a formal instrument and normally
requires the payment of interest?
An account receivable
A trade receivable
A note receivable
Past-due accounts receivables - CORRECT ANSWER a note receivable
Which of the following should be classified as an "other" receivable?
Notes receivable
Trade receivables
Interest receivable
Accounts receivable - CORRECT ANSWER interest receivable
,What type of receivables result from sales transactions?
Other receivables
Trade receivables
Long-term receivables
Non-trade receivables - CORRECT ANSWER trade receivables
On June 15, Kersee Company sold merchandise on account to Eng Co. for $1,000,
terms 2/10, n/30. On June 20, Eng Co. returns merchandise worth $300 to Kersee
Company. On June 24, payment is received from Eng Co. for the balance due.
What is the amount of cash received on June 24?
$700.
$680.
$686.
None of the answer choices are correct. - CORRECT ANSWER 686
, When is a receivable recorded by a service organization?
When service is provided on account
When the related expenses are incurred
When the customer pays
When the bill is sent to the customer - CORRECT ANSWER when service is
provided on account
Receivables are reported on the balance sheet at the cash amount owed by
customers.
True
False - CORRECT ANSWER false
While the balance of accounts receivable represents the amount owed by
customers, the amount reported on the balance sheet is shown at their cash (net)
realizable value. This is the amount the company expects to collect.
Under the allowance method, the write off of an account receivable leaves the
net realizable value of the receivables unchanged.
with Verified Answers
What type of receivable is evidenced by a formal instrument and normally
requires the payment of interest?
An account receivable
A trade receivable
A note receivable
Past-due accounts receivables - CORRECT ANSWER a note receivable
Which of the following should be classified as an "other" receivable?
Notes receivable
Trade receivables
Interest receivable
Accounts receivable - CORRECT ANSWER interest receivable
,What type of receivables result from sales transactions?
Other receivables
Trade receivables
Long-term receivables
Non-trade receivables - CORRECT ANSWER trade receivables
On June 15, Kersee Company sold merchandise on account to Eng Co. for $1,000,
terms 2/10, n/30. On June 20, Eng Co. returns merchandise worth $300 to Kersee
Company. On June 24, payment is received from Eng Co. for the balance due.
What is the amount of cash received on June 24?
$700.
$680.
$686.
None of the answer choices are correct. - CORRECT ANSWER 686
, When is a receivable recorded by a service organization?
When service is provided on account
When the related expenses are incurred
When the customer pays
When the bill is sent to the customer - CORRECT ANSWER when service is
provided on account
Receivables are reported on the balance sheet at the cash amount owed by
customers.
True
False - CORRECT ANSWER false
While the balance of accounts receivable represents the amount owed by
customers, the amount reported on the balance sheet is shown at their cash (net)
realizable value. This is the amount the company expects to collect.
Under the allowance method, the write off of an account receivable leaves the
net realizable value of the receivables unchanged.
