1. 1. Which of the following is not true of accounts receivable?
   1. Accounts receivable is an amount owed by a customer on purchase of company products or services.
   2. Accounts receivable is recorded at the time of sale.
   3. Accounts receivable is reported at net realizable value.
   4. Losses from the inability to collect accounts receivable are recorded in the accounting system as sales returns.
   2. The amount of cash that a company expects to collect from its total or gross accounts receivable balance is called:
   1. Accounts receivable
   2. Net realizable value
   3. Sales returns
   4. Bad debt
   3. Suppose that Jerry and Co. grants terms of 2/10, n/30 related to a sale on June 5 and on June 12 the customer pays the remaining $250 bill. Jerry and Co. would record the receipt of the payment as:

   1. Cash	245
      Sales Discounts	5
      Accounts Receivable		250
      (To record payment)

   2. Cash	240
      Sales Discounts	10
      Accounts Receivable		250
      (To record payment)

   3. Cash	200
      Sales Discounts	50
      Accounts Receivable		250
      (To record payment)

   4. Cash	250
      Sales Discounts		5
      Accounts Receivable		245
      (To record payment)

   4. Losses from the inability to collect accounts receivable are recorded in the accounting system as:
   1. Sales allowances
   2. Sales returns
   3. Baddebtsexpense
3. 1. Other expense
   5. What is true of the direct-write off method of estimating bad debt expense?
   1. The receivable is written off the companys accounting records.
   2. The amount is recorded as a bad debt expense.
   3. It accounts for the receivable with only one entry.
   4. All of these choices are correct.

1. The interest on a $5,400, 3%, 45-day note is

1. $20.25.
2. $202.50.
3. $2.03.
4. $19.97.

2. The journal entry to record the adjusting entry for accrued interest on a note receivable would include a

1. debit to Cash.
2. debit to Interest Expense.
3. credit to Interest Revenue.
4. debittoNotesReceivable.

1. The allowance for doubtful accounts is reported as a(n) __________ on the balance sheet.

1. addition to accounts receivable
2. deduction from accounts receivable
3. addition to notes receivable
4. deduction from trading investments

2. All receivables that are expected to be realized in cash within a year are reported in the __________ section of the balance sheet.

1. Current Assets
2. Investments
3. Noncurrent Assets
4. CurrentLiabilities

1. The accounts receivable turnover is computed as

1. sales divided by accounts receivable.
2. sales divided by average accounts receivable.
3. sales divided by net income.
4. None of these choices are correct.

2. The number of days' sales in receivables is calculated as

1. sales divided by accounts receivable.
2. average accounts receivable divided by average daily sales.
3. sales divided by net income.
4. Noneofthesechoicesarecorrect.

Apr.	2.	Sold merchandise on account to Peking Palace Co., $36,730. The cost of the merchandise sold was $25,310.
June	9.	Received $11,950 from Peking Palace Co. and wrote off the remainder owed on the sale of April 2 as uncollectible.
Oct.	31.	Reinstated the account of Peking Palace Co. that had been written off on June 9 and received $24,780 cash in full payment.

Journalize the above transactions in the accounts of Dining Interiors Company, a restaurant supply company that uses the allowance method of accounting for uncollectible receivables. Refer to the Chart of Accounts for exact wording of account titles. The accounts receivableclerk for Waddell Industries prepared the following partially completed aging of receivables schedule as of the end of business on August 31:

1	A	B	C	D	E	F	G
2				Days Past Due	Days Past Due	Days Past Due	Days Past Due
3	Customer	Balance	Not Past Due	1-30	31-60	61-90	Over 90
4	Acme Industries Inc.	2,600.00	2,600.00
5	Alliance Company	4,200.00		4,200.00
6	~~~~~	~~~~~	~~~~~	~~~~~	~~~~~	~~~~~	~~~~~
7	Zollinger Company	5,200.00			5,200.00
8	Subtotals	1,051,100.00	597,500.00	223,600.00	114,300.00	85,400.00	30,300.00

The following accounts were unintentionally omitted from the aging schedule and not included in the preceding subtotals:

Builders Industries	$44,100	May 1
Elkhorn Company	20,600	June 20
Granite Creek Inc.	7,800	July 13
Lockwood Company	13,500	September 9
Teton Company	12,400	August 7

Required:

A.	Determine the number of days past due for each of the preceding accounts as of August 31. If an account is not past due, enter a zero.
B.	Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals. If an amount box does not require an entry, leave it blank.