1- Paper Company receives a $4,916, three-month, 6% promissory note from Dame Company in settlement of an open accounts receivable. What entry will Paper Company make upon receiving the note?

a.

Notes Receivable, Dame Company	$4,990
Accounts Receivable, Dame Company		$4,916
Interest Revenue		$74

b.

Notes Receivable, Dame Company	$4,916
Interest Revenue	$74
Accounts Receivable, Dame Company		$4,916
Interest Receivable		$74

c.

Notes Receivable, Dame Company	$4,990
Accounts Receivable, Dame Company		$4,990

d.

Notes Receivable, Dame Company	$4,916
Accounts Receivable, Dame Company		$4,916

2- Selling receivables

a. results in bad debt expense

b. occurs when an account becomes uncollectible

c. shifts some of the risk to the buyer

d. delays the receipt of cash

3- Allowance for Doubtful Accounts has a credit balance of $600 at the end of the year (before adjustment), and bad debt expense is estimated at 1% of credit sales. If credit sales are $655,200, the amount of the adjusting entry to record the estimated uncollectible accounts receivable

a. is $7,152

b. is $6,552

c. is $5,952

d. Cannot be determined.

4- Allowance for Doubtful Accounts has a debit balance of $900 at the end of the year (before adjustment), and bad debt expense is estimated at 1% of credit sales. If credit sales are $655,000, the amount of the adjusting entry to record the estimate of the uncollectible accounts

a. is $5,650

b. is $900

c. is $6,550

d. is $7,450