Percentage of Net Sales and Accounts Receivable Aging Method.   Requirements:

1. Which of the following statements is incorrect regarding the classification of accounts and notes receivable? a. Valuation accounts should be appropriately offset against the proper receivable accounts. b. Segregation of the different types of receivables is required if they are material. c. Disclose any loss contingencies that exist on the receivables. d. Any discount or premium resulting from the determination of present value in notes receivable transactions is an asset or liability respectively.   2. Which of the following is an appropriate reconciling item to the balance per bank in a bank reconciliation? a. Bank service charge b. Chargeback for NSF check c. Deposit in transit d. Bank interest   3. Which of the following is not true? a. The Petty Cash account is debited when the fund is replenished. b. The imprest petty cash system in effect adheres to the rule of disbursement by check. c. Entries are made to the Petty Cash account only to increase or decrease the size of the…

Which of the following method annual bad debt expense best achieved the matching concept

44.Which is a valid statement regarding the gross price, net price and allowance methods of recording accounts receivable from customers?     a. Under the gross method, sales discount is recorded when taken and this account is reported as an item of other expense in the statement of comprehensive income. b. Under the net method, sales discount is recorded when not taken and this is reported as an item of other income in the statement of comprehensive income.  c. When accounts receivable have not yet been collected at the end of the year and the discount period has already lapsed, after appropriate adjusting entry(ies), the amount of net  accounts receivable reported under the gross method is greater than the amount reported under the net method. d. When accounts receivable have not yet been collected at the end of the year and the discount period has already lapsed, no adjusting entry is required under the net method.

Which of the following is not an accurate description of the Allowance for Doubtful Accounts? Multiple Choice The account is a contra account. The account is a liability. The amount of the Allowance for Doubtful Accounts decreases the net realizable value of a company's receivables. The account is increased by an estimate of uncollectible accounts expense.

When using the percentage of sales method to estimate the amount of bad debt expense for uncollectible accounts, what effect would a debit balance in Allowance for Doubtful Accounts have on the current period's adjusting entry? a.A debit balance would increase the amount of the current period's adjusting entry. b.A debit balance would decrease the amount of the current period's adjusting entry. c.The balance in Allowance for Doubtful Accounts would be ignored when making the current period's adjusting entry. d.A debit balance would be carried over to the next period.

If CBA Failed to meet earning expectations because Loan Impairment expense was Higher than expected, the ERC is likely to be? A. Small, as imperfections are 'fictitious accounting' B. Big, as markets dislike impairments more than other forms of expenses C. Small, because impairment represents once off expense D. Very large, because loan impressions account for a significant portion of the revenue

We are currently working on Bad Debt expense and Receivables.  Please see attachement.

Why does the Bad Debts Expense account usually not have the same adjusted balance as the Allowance for Doubtful Accounts?

With credit tranching, the subordinated tranches may absorb credit losses as they occur.   Select one: True False