Ole Miss Accy 201 Ch. 8,9,10,11 (test 3) UPDATED ACTUAL
Questions and CORRECT Answers
Recievables includes all money claims against other entities, including people, companies, and
other organizations
Accounts Receivable normally collected in a short period, such as 30, or 60 days
Notes Receivable amounts that customers owe for which a formal, written instrument of credit has
been issued
, Bad Dept Expense the operating expense recorded from uncollected receivables
Direct write-off method Recording bad debt expense only when an account is determined to be
worthless
Allowance method records bad debt expense by estimating uncollectible accounts at the end of the
accounting period
Allowance for Doubtful Accounts is credited for the estimated bad debts
Net Realizable Value (balance sheet) the value of receivables is reduced to the amount that is to be expected to be
collected or realized
Aging the Recievables The preceding steps are summarized in an aging schedule, ant this process is
called ________________
Maturity value the amount that must be paid at the due date of the note, which is the sum of the
face amount and the interest
dishonored note receivable If the maker of a note fails to pay the note on the due date
accounts recievable turnover net sales/average accounts recievable
number of days' sales in receivables estimate of the length of time the accounts receivable have been outstanding
Fixed assets assets that are relatively permanent, such as land, buildings, and equipment
Depreciation recording the cost of fixed assets
book value (of a fixed asset) Usually does not agree with the assets market value
initial cost (of a fixed asset) the purchase price of a fixed asset plus all the costs to obtain it ready for use
Questions and CORRECT Answers
Recievables includes all money claims against other entities, including people, companies, and
other organizations
Accounts Receivable normally collected in a short period, such as 30, or 60 days
Notes Receivable amounts that customers owe for which a formal, written instrument of credit has
been issued
, Bad Dept Expense the operating expense recorded from uncollected receivables
Direct write-off method Recording bad debt expense only when an account is determined to be
worthless
Allowance method records bad debt expense by estimating uncollectible accounts at the end of the
accounting period
Allowance for Doubtful Accounts is credited for the estimated bad debts
Net Realizable Value (balance sheet) the value of receivables is reduced to the amount that is to be expected to be
collected or realized
Aging the Recievables The preceding steps are summarized in an aging schedule, ant this process is
called ________________
Maturity value the amount that must be paid at the due date of the note, which is the sum of the
face amount and the interest
dishonored note receivable If the maker of a note fails to pay the note on the due date
accounts recievable turnover net sales/average accounts recievable
number of days' sales in receivables estimate of the length of time the accounts receivable have been outstanding
Fixed assets assets that are relatively permanent, such as land, buildings, and equipment
Depreciation recording the cost of fixed assets
book value (of a fixed asset) Usually does not agree with the assets market value
initial cost (of a fixed asset) the purchase price of a fixed asset plus all the costs to obtain it ready for use
