1) The Allowance for Bad Debts account has a debit balance of $9000 before the adjusting entry for bad debts expense. After analyzing the accounts in the accounts receivable subsidiary ledger using the aging-of-receivables method, the company's management estimates that uncollectible accounts will be $11,000. What amount of bad debts expense will be reported on the income statement? A) $2000 B) $11,000 C) $8000 D) $20,000

2) Newton Corporation settles a liability by making a payment in cash. How does paying this liability affect the accounting equation of the business? A) assets increase and equity decreases B) liabilities decrease and equity increases C) assets and liabilities decrease D) assets and liabilities increase

3) Adams, Inc. recorded the following journal entry on March 2, 2018.

Cash 9,000 Unearned Revenue 9,000

From the journal entry above, identify the transaction on March 2, 2018. A) Adams paid $9,000 for services to be received at a later date. B) Adams received $9,000 for services to be performed in a later period. C) Adams sold goods for $9,000 cash. D) Adams purchased goods worth $9,000 and signed a one-year note for the same amount.

4) On January 1, 2017, the Accounts Receivable of Martha, Inc. had a debit balance of $150,000. During January, the company provided services for $400,000 on account. The company collected $240,000 from its customers on account in January. What was the ending balance in the Accounts Receivable account at the end of January? A) $310,000 B) $550,000 C) $400,000 D) $160,000

5) Which of the following accounts will be closed by debiting the Income Summary account?

A) Service Revenue B) Depreciation Expense C) Accounts Payable D) Accumulated Depreciation

6) A merchandiser uses a perpetual inventory system. The beginning Retained Earnings balance of the merchandiser was $95,000. During the year, Sales Revenue amounted to $75,000, Cost of Goods Sold was $30,000, and all other expenses totaled $12,000. The company declared and paid $19,000 as dividends. The last step in the closing process would include ________. A) a debit to the Retained Earnings account for $33,000 B) a debit to Income Summary for $33,000 C) a credit to Income Summary for $19,000 D) a debit to the Retained Earnings account for $19,000

7) Which of the following states that a company must perform strictly proper accounting only for items that are significant to the business's financial statements? A) conservatism B) materiality concept C) consistency principle D) disclosure principle

8) A company has net credit sales of $1,200,000, beginning net accounts receivable of $290,000, and ending net accounts receivable of $201,000. What is the days' sales in accounts receivable? (Round any intermediate calculations to two decimal places, and your final answer to the nearest whole day.) A) 149 days B) 75 days C) 61 days D) 88 days

9) Following is an extract of account balances of Aztec Moving Services as of December 31, after the first of operation.

Accounts Receivable $6,000 Accounts Payable 4,000 Salaries Expense 5,000 Repairs Expense 500 Truck 11,000 Equipment 11,000 Notes Payable 8,500 Cash 7,300 Supplies Expense 1,500 Service Revenue 29,000 Gasoline Expense 2,900 Salaries Payable 200

What is the amount of total assets at the end of the year? A) $35,300 B) $29,300 C) $17,000 D) $22,000