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22. A check returned by the bank marked NSF means no service fee. b. no signature found. c. not satisfactorily filled out. not sufficient funds.
22. A check returned by the bank marked "NSF" means no service fee. b. no signature found. c. not satisfactorily filled out. not sufficient funds. d. a. 23. Which of the following is not a basic principle of cash management? Increase the speed of collection on receivables. b. Maintain idle cash. c. Keep inventory levels low, d. Delay payment of liabilities. 24, The term "receivables" refers to amounts due from individuals or companies. b. merchandise to be collected from individuals or companies. c. cash to be paid to creditors. d. cash to be paid to debtors. a. 25. The expense recognition a. requires that all credit losses be recorded when an individual customer cannot pay. b. necessitates the recording of an estimated amount for bad debts. c. results in the recording of a known amount for bad debt losses. d. is not involved in the decision of when to expense a credit loss. 26. Bad Debt Expense is considered an avoidable cost in doing business on a credit basis. an internal control weakness. a. b. a necessary risk of doing business on a credit basis. d. c. avoidable unless there is a recession. Two methods of accounting for uncollectible accounts are the a. allowance method and the accrual method. b. allowance method and the net realizable method. c. direct write-off method and the accrual method. d. direct write-off method and the allowance method. 27. If an account is collected after having been previously written off the allowance account should be debited. b. only the control account needs to be credited. both income statement and balance sheet accounts will be affected. d. there will be both a debit and a credit to accounts receivable. 28. a. c. When calculating interest on a promissory note with the maturity date stated in terms of days, 29. the a. maker pays more interest if 365 days are used instead of 360. b. maker pays the same interest regardless if 365 or 360 days are used. c. payee receives more interest if 360 days are used instead of 365. d. payee receives less interest if 360 days are used instead of 365
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