ACCT 201A EXAM QUESTIONS & DETAILED ANSWERS
(PERFECTLY VERIFIED) GRADED A+
When a company provides services on account, which of the following accounts is debited?
Service Revenue.
Accounts Payable.
Accounts Receivable.
Cash. - CORRECT ANSWER >>>Accounts Receivable.
A sales discount is recorded by the seller as a(n):
Expense.
Contra asset.
Contra revenue.
Liability. - CORRECT ANSWER >>>contra
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?
Debit Cash for $500.
Credit Accounts Receivable for $490.
Credit Service Revenue for $500.
Debit Sales Discount for $10. - CORRECT 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?
Sales Allowance.
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,Sales Discount.
Trade Discount.
Allowance for Uncollectible Accounts. - CORRECT ANSWER >>>Sales Allowance.
Use the information below to calculate net revenues.
Service Revenue$100,000 Sales Discounts$2,000 Accounts Receivable$15,000 Sales
Allowances$7,000 Cash$18,000
$91,000.
$85,000. $68,000.
$98,000. - CORRECT ANSWER >>>$91,000. (Don't include cash or account receivable both
assets)
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?
$4,850.
$5,000.
$5,150.
$5,300. - CORRECT 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?
$4,850.
$5,000.
$5,150.
$5,300. - CORRECT ANSWER >>>$4,850.
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, The entry to record the estimate for uncollectible accounts includes:
A debit to Allowance for Uncollectible Accounts.
A credit to Accounts Receivable.
A debit to Sales Revenue.
A debit to Bad Debt Expense. - CORRECT ANSWER >>>A debit to Bad Debt Expense.
Under the allowance method for uncollectible accounts, the balance of Allowance for
Uncollectible Accounts increases when:
Future bad debts are estimated.
Bad debts actually occur.
Cash is received from customers.
Never. - CORRECT 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:
$96,000.
$96,200.
$100,000.
$104,000. - CORRECT 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?
$800.
$4,800.
$5,600.
$6,400. - CORRECT ANSWER >>>$5,600.
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(PERFECTLY VERIFIED) GRADED A+
When a company provides services on account, which of the following accounts is debited?
Service Revenue.
Accounts Payable.
Accounts Receivable.
Cash. - CORRECT ANSWER >>>Accounts Receivable.
A sales discount is recorded by the seller as a(n):
Expense.
Contra asset.
Contra revenue.
Liability. - CORRECT ANSWER >>>contra
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?
Debit Cash for $500.
Credit Accounts Receivable for $490.
Credit Service Revenue for $500.
Debit Sales Discount for $10. - CORRECT 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?
Sales Allowance.
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,Sales Discount.
Trade Discount.
Allowance for Uncollectible Accounts. - CORRECT ANSWER >>>Sales Allowance.
Use the information below to calculate net revenues.
Service Revenue$100,000 Sales Discounts$2,000 Accounts Receivable$15,000 Sales
Allowances$7,000 Cash$18,000
$91,000.
$85,000. $68,000.
$98,000. - CORRECT ANSWER >>>$91,000. (Don't include cash or account receivable both
assets)
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?
$4,850.
$5,000.
$5,150.
$5,300. - CORRECT 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?
$4,850.
$5,000.
$5,150.
$5,300. - CORRECT ANSWER >>>$4,850.
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, The entry to record the estimate for uncollectible accounts includes:
A debit to Allowance for Uncollectible Accounts.
A credit to Accounts Receivable.
A debit to Sales Revenue.
A debit to Bad Debt Expense. - CORRECT ANSWER >>>A debit to Bad Debt Expense.
Under the allowance method for uncollectible accounts, the balance of Allowance for
Uncollectible Accounts increases when:
Future bad debts are estimated.
Bad debts actually occur.
Cash is received from customers.
Never. - CORRECT 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:
$96,000.
$96,200.
$100,000.
$104,000. - CORRECT 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?
$800.
$4,800.
$5,600.
$6,400. - CORRECT ANSWER >>>$5,600.
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