Answer the following 1-10 questions for intermediate accounting:

1. Companies value and report short-term receivables at net realizable value, the net amount they expect to receive in cash

True

False

2. When should the loss on an uncollectible account receivable be recorded as an expense for accrual accounting purposes?

A. At any day there is an indication that certain customer will not pay

B. At the beginning of accounting period

C. The day the credit sale is recorded

D. At the end of accounting period

E. Never

3. Which of the following is NOT an accurate description of the Allowance for Doubtful Accounts?

A. an income statement account

B. a balance sheet account

C. an estimate of the amount of accounts receivable that will not be collected

D. a contra asset account

4. The following accounts were taken from Starr Co.'s unadjusted trial balance at December 31, 2017: Accounts receivable, DR $880,000 Allowance for uncollectible accounts, DR 27,000 Net credit sales, CR $2,000,000 Starr estimates that 8% of the gross accounts receivable will become uncollectible. After adjustment at December 31, 2017, the allowance for uncollectible accounts should have a credit balance of

A. 160,000

B. 70,400

C. 27,000

D. 43,400

E. 97,400

5. The following accounts were abstracted from Starr Co.'s unadjusted trial balance at December 31, 2017: Accounts receivable DR $880,000 Allowance for uncollectible accounts DR 27,000 Net credit sales CR $2,000,000 Starr estimates that 8% of the gross accounts receivable will become uncollectible. What is a bad debt expense for the year?

A. 97,400

B. 70,400

C. 43,400

D. 27,000

E. 160,000

6. Why would a company sell receivables to another company?

A. To limit its legal liability

B. To improve the quality of its credit granting process

C. To comply with customer agreements

D. To accelerate access to amounts collected

7. BobCat Co. uses the GROSS method to record sales made on credit. On Mar 1, 2017, it made sales of $80,000 with terms 3/10 n/30. On Mar 9, 2017, BobCat received full payment for the March 1 sale. The required journal entries for BobCat Inc. on Mar 9 is

A. DR Accounts Receivable 80,000 CR Sales Revenue 80,000

B. DR Accounts Receivable 77,600 CR Sales Revenue 77,600

C. DR Cash.. 77,600 DR Sales Discount 2,400 CR Accounts Receivable 80,000

D. DR Cash.. 77,600 CR Accounts Receivable 77,600

E. DR Cash 80,000 CR Accounts Receivable 80,000

8. The following information relates to Jay Co.s accounts receivable for the year just ended: Accounts receivable, 1/1 $ 650,000 Credit sales for the year 2,700,000 Sales returns for the year 75,000 Accounts written off during the year 40,000 Collections from customers during the year 2,150,000 Estimated uncollectible accounts at 12/31 R 110,000

What amount should Jay report on the Balance Sheet for net realizable value of accounts receivable at December 31?

A. 1,085,000

B. 540,000

C. 2,700,000

D. 975,000

E. 650,000

9. The following are held by BobCat Inc.: Cash in checking account $6,000 Cash in savings account $12,000 Postdated check from customer dated one month from balance sheet date 2,500 Petty cash 300 Commercial paper (matures in a month, original maturity 3 months) 9,000 Certificate of deposit (matures in six months) 5,000 What amount should be reported as cash and cash equivalents on Smites balance sheet?

A. 27,300

B. 18,000

C. 18,300

D. 27,000

10. Hilltop Co.s monthly bank statement shows a balance of $52,200. Reconciliation of the statement with company books reveals the following information: Bank service charge $ 10 Insufficient funds check 650 Checks outstanding 1,500 Deposits in transit 1300 Check deposited by Hilltop and cleared by the bank for $125, but improperly recorded by Hilltop as $152.

What is the TRUE cash balance after the reconciliation?_______________

A. 54,200

B. 52,000

C. 52,027

D. 51,973