1) On a classified balance sheet, inventory is classified as

a long-term investment.

b current asset.

c property, plant, and equipment.

d an intangible asset.

2) An aging of a company's accounts receivable indicates that $3,000 are estimated to be uncollectible. If Allowance for Doubtful Accounts has a $800 debit balance, the adjustment to record bad debts for the period will require a

a. debit to Bad Debt Expense for $3,800.

b. debit to Bad Debt Expense for $2,200.

c. credit to Allowance for Doubtful Accounts for $800.

d. debit to Bad Debt Expense for $3,000.

3) Inventory is reported in the financial statements at

a. the higher-of-cost-or-market.

b. Market.

c. Cost.

d. the lower-of-cost-or-market.

4) On July 9, Sheb Company sells goods on credit to Wooley Company for $5,000, terms 1/10, n/60. Sheb receives payment on July 18. The entry by Sheb on July 18 is:

a. Cash 5,000

Accounts Receivable 5,000

b. Cash 4,950

Sales Discounts 50

Accounts Receivable 5,000

C. Cash 5,000

Sales Discounts 50

Accounts Receivable 4,950

D. Cash 5,050

Sales Discounts 50

Accounts Receivable 5,000