Question  The average collection period is the average amount of time that elapses from a credit sale until the company can use the payment (collection) of the sale. True or false?

Q: What is a sensible credit period? Should the credit period for your company's sales vary depending…

A: Credit period is the days that a customer is allowed to wait before paying the invoice. There is no…

Q: The business needs to record the trade discount in the book of account”. Question Do you agree…

A: Discount means the amount which is not required to be paid or received. Discount is deducted to find…

Q: The realisation concept determines when goods sent on credit to customers are to be included in the…

A: Sales: It is an activity of selling goods and services in exchange for money.

Q: what is the basis of determining an allowance for doubtful accounts? O company's collection…

A: Allowance for Doubtful Accounts is a contra asset account. This account is a provision, which is…

Q: what is the estimate of uncollectible accounts receivable based on the percentage of sales

A: Account receivable means where goods has been sold on credit and amount has not been received.…

Q: An account that is classified as a contra-revenue: O a. may include sales discounts and credit card…

A: Solution: A contra revenue account is reverse of revenue account i.e. contra revenue accounts is…

Q: When a product is sold on credit, which account should be debited for the seller? A.cash…

A: Sale of a product means to sell the goods in stock to the customer. It can be sold either on cash or…

Q: How do you calculate accounts receivable turnover? Select an answer. Take the beginning A/R balance,…

A: The accounts receivables turnover ratio is a sub-category of activity ratios, which indicates the…

Q: True or False: In the credit and operating cycle, the collection stage or cycle begins with the…

A: STEP 1 An operation ratio reflecting the approximate time needed to convert a company's goods into…

Q: NO 1 STATEMENT If the customer is to pay the shipping charges, the copy of the bill of indicate…

A: Goods - Goods are the items that businesses purchase and exchange. Goods might be unfinished…

Q: Identify the statement below that is correct. Multiple Choice O Accounts receivable are held by a…

A: Accounts Receivable are the amounts owing to a company by its customers or clients for items sold or…

Q: It is an amount owed to suppliers for goods purchased or services performed on credit. O a. Accounts…

A: Accounts payable is credited when goods are purchased on credit. Unearned revenue is when cash is…

Q: 2 ______________is the average number of days between the dates that credit sales were made, and…

A: The credit sales are the sales made on the credit basis by the business and lead increase in debtors…

Q: What does the days’ sales in receivables indicate, and how is it calculated?

A: Day's Sales: Day's sales refer to the average number of days for which a receivable remain…

Q: Sales Returns and Sales Allowances. What are Sales Discounts? What are their respective normal…

A:

Q: Question Content Area If a company accepts a major credit card such as Visa from a customer, then…

A: False

Q: Which of the following is correct when a company uses the net price method of recording receivables?…

A: Under net method, the sales are initially recorded with the net amount after deducting the amount of…

Q: When a customer (buyer) returns merchandise purchased on credit,what is to be done?

A: Sales Returns: It is the merchandise returned by a buyer to a seller due to many reasons like excess…

Q: 16. Which of the following is a contra account? a. Sales discounts b. Purchase returns and…

A: In accounting, a contra account is a unique kind of account that is used to lower the balance of a…

Q: If a company is able to estimate the rate of redemption for gift cards, they should use the ________…

A: The objective of the question is to identify the appropriate accounting method for breakage when a…

Q: What is the effect of the following situations on the cost of accounts receivable financing? (A) A…

A: It will increase default chances

Q: What is a sale on credit and why it is needed? Give three examples?

A: Sale on Credit: A sale on credit is revenue earned by a company when it sells goods and allows the…

Q: What are the reasons that a company gives trade discounts?Why are trade discounts not recorded in…

A: A reduction in list or catalog price which is granted by the supplier of goods/services can be…

Q: Which method of estimating uncollectible accounts does not take the previous balance in the…

A: Bad debt expense formula: Percentage of account receivable method = Accounts receivable x Estimated…

Q: Which of the following refers to the ability of a firm to buy repeatedly from a supplier on trade…

A: Trade credit is a short term financing tool available to companies.Using trade credit a company is…

Q: Explain “Sales Returns and Allowances”. Why does this account have a normal debit balance?

A: Sales Returns and Allowances Sales Return and Allowances is actually a contra revenue account (i.e.…

Q: While reporting revenue, how a company should consider barter arrangement and discount?

A: Revenue Reporting: The process of accounting for revenue for a product you offer to a client is…

Q: If any discount is offered for early payment of invoice will be called as a. Cash discount b. Trade…

A: An early payment discount – also known as a prompt payment discount or early settlement discount /…

Q: In a perpetual system, what would be the journal entry for a sales return. (a) Dr. Sales return and…

A: Journal entry is a process of recording the business transactions in the books of accounts for the…

Q: Amounts due from customers that are expected to be collected in the current operating cycle and do…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Explain the trade credit facility provided by some companies to their customers that allow them to…

A: Trade credit Trade credit is a cash discount given to customer by seller to make early payments.…

Q: Which of the following would not be reported on the financial statement?

A: All transaction that are reported in books of accounts need to be reported in financial statements.…

Q: What do you call to a document issued when you purchase or sold on account (credit basis)? 2. It is…

A: The accounting is a process to identify the business transactions, record the transactions and…

Q: Credit card discounts are deducted from gross sales to calculate net sales revenue. False True

A: Discount is the amount which is deducted from the price of goods to arrive at the net amount paid by…

Q: Amounts owed by customers on account. [ Choose ] The analysis of customer balances by the [ Choose ]…

A: As per the guidelines, only three parts are allowed to be solved. Please resubmit the remaining…

Q: If a company sells its accounts receivables to a factor O a. there is a gain on the sale of the…

A: Solution: Factoring is a financial transaction thru which business sells its accounts receivables at…

Q: Which of the following accounts is not a contra-revenue? Group of answer choices A)Sales discounts…

A: Contra-Revenue: When revenue has a debit balance instead of a credit balance, this is known as…

Q: Please tell us about Sales Discounts.  Why are they necessary?  Does this account appear on the…

A: Discount is the amount of reduction in the value of sale or purchase. In other words, discount in…

Q: Which of the following groupings of accounts includes only accounts that carry a normal credit…

A: The assets and expenses have the normal debit balance and these accounts are debited with increase…