Principles of Accoun ng (Exam 3)|Ques ons and
answers | Updated RATED A+ | 2026
Accounts Receivable
A claim against the customer created by selling merchandise or services on credit.
Allowance for Doub ul Accounts
The contra asset account for accounts receivable.
Allowance Method
The method of accoun ng for uncollec ble accounts that provides an expense for uncollec ble
receivables in advance of their write-off.
Bad Debt Expense
The opera ng expense incurred because of the failure to collect receivables.
Direct write-off Method
The method of accoun ng for uncollec ble accounts that recognizes the expense only when
accounts are judged to be worthless.
Dishonored Note
A note that the maker fails to pay on the due date.
Maturity Value
The amount that is due at the maturity or due date of a note.
Net Realizable Value
The es mated selling price of an item of inventory less any direct costs of disposal, such as sales
commissions.
Notes Receivable
A customer's wri+en promise to pay an amount and possibly interest at an agreed-upon rate.
Promissory Notes
A signed document containing a wri+en promise to pay a stated sum to a specified person or
the bearer at a specified date or on demand.
, Receivable
Amounts owed to a business, regarded as assets.
Uncollec ble Accounts
The method of accoun ng for uncollec ble accounts that provides an expense for uncollec ble
receivables in advance of their write-off.
Accelerated Deprecia on Method
A deprecia on method that provides for a higher deprecia on amount in the first year of the
asset's use, followed by a gradually declining amount of deprecia on.
Accumulated Deprecia on
The contra asset account credited when recording the deprecia on of a fixed asset.
Amor za on
The periodic transfer of the cost of an intangible asset to expense.
Book Value
The cost of a fixed asset minus accumulated deprecia on on the asset.
Capital Expenditures
The costs of acquiring fixed assets, adding to a fixed asset, improving a fixed asset, or extending
a fixed asset's useful life.
Copyright
An exclusive right to publish and sell a -literary, ar s c, or musical composi on.
Deple on
The process of transferring the cost of natural resources to an expense account.
Deprecia on
The systema c periodic transfer of the cost of a fixed asset to an expense account during its
expected useful life.
Depreciable Cost
The amount of an asset's cost that will be depreciated. The cost minus the expected salvage
value.
answers | Updated RATED A+ | 2026
Accounts Receivable
A claim against the customer created by selling merchandise or services on credit.
Allowance for Doub ul Accounts
The contra asset account for accounts receivable.
Allowance Method
The method of accoun ng for uncollec ble accounts that provides an expense for uncollec ble
receivables in advance of their write-off.
Bad Debt Expense
The opera ng expense incurred because of the failure to collect receivables.
Direct write-off Method
The method of accoun ng for uncollec ble accounts that recognizes the expense only when
accounts are judged to be worthless.
Dishonored Note
A note that the maker fails to pay on the due date.
Maturity Value
The amount that is due at the maturity or due date of a note.
Net Realizable Value
The es mated selling price of an item of inventory less any direct costs of disposal, such as sales
commissions.
Notes Receivable
A customer's wri+en promise to pay an amount and possibly interest at an agreed-upon rate.
Promissory Notes
A signed document containing a wri+en promise to pay a stated sum to a specified person or
the bearer at a specified date or on demand.
, Receivable
Amounts owed to a business, regarded as assets.
Uncollec ble Accounts
The method of accoun ng for uncollec ble accounts that provides an expense for uncollec ble
receivables in advance of their write-off.
Accelerated Deprecia on Method
A deprecia on method that provides for a higher deprecia on amount in the first year of the
asset's use, followed by a gradually declining amount of deprecia on.
Accumulated Deprecia on
The contra asset account credited when recording the deprecia on of a fixed asset.
Amor za on
The periodic transfer of the cost of an intangible asset to expense.
Book Value
The cost of a fixed asset minus accumulated deprecia on on the asset.
Capital Expenditures
The costs of acquiring fixed assets, adding to a fixed asset, improving a fixed asset, or extending
a fixed asset's useful life.
Copyright
An exclusive right to publish and sell a -literary, ar s c, or musical composi on.
Deple on
The process of transferring the cost of natural resources to an expense account.
Deprecia on
The systema c periodic transfer of the cost of a fixed asset to an expense account during its
expected useful life.
Depreciable Cost
The amount of an asset's cost that will be depreciated. The cost minus the expected salvage
value.
