B) $296 S288 c) D) $280 E) $276 The expense associated with the cost of uncollectible accounts receivable is known as bad debts expense. A) True. B) False 26. 27. The inventory valuation method that results in the lowest taxable income in a period of inflation is: A) LIFO method. B) FIFO method. C) Weighted average cost method. D) Specific identification method. E) None of the above. 28. If a period-end inventory amount is reported in error, it can cause a misstatement in A) Cost of goods sold. B) Gross profit. C) Net income. D) Current assets. E) All of the above. A company has inventory of 15 units at a cost of $12 each on August 1.On August 5, it purchased 10 units at $13 per unit, On August 12 it purchased 20 units at $14 per unit. On 29. August 15, it sold 30 units. Using the FIFO perpetual inventory method, what is the value of the inventory at August 12 after the sale? A) $140 B) $160 C) $210 D) $380 E) $590 30. A check was written by a business for $507 but was recorded in the journal as $705. How would this error be included on the bank reconciliation? A) a deduction on the bank side B) an addition on the book side C) an addition on the bank side D) a deduction on the book side 31. The following information is from the records of Armadillo Camera Shop: $80,000 Accounts receivable, December 31,2017 debit 63,000 credit sales for 2017 written off as uncollectible during 017 ash sales during 2017 The company debts expense? A) $80,000 B) $42,000 C) $65,000 D) $18,000 uses the direct write-off method for bad debts. What is the amount of bad 32. Under the direct write-off meth write-off method, the entry to write off an uncollectible account will include A) a debit to Bad Debts Expense account B) a debit to the customer's Account Receivable C) a credit to the Allowance for Bad Debts D) No entry is made to write off uncollectible accounts. 33. On January 1, A Plus Services has the following balances: Accounts Receivable $28,000 (debit) Bad Debts Expense S0 A Plus Services has the following transactions during January: Credit sales of $110,000, collections of credit sales of $87,000, and write-offs of $19,000. A Plus Services uses the direct write-off method. At the end of January, the balance of Accounts Receivable is "Do not round until the final answer. Then round to the nearest whole dollar." A) $15,027 B) $32,000 C) $24,023 D) $51,000 34. The two methods of accounting for uncollectible receivables are A) the direct write-off method and the liability method B) the asset method and the sales method C) the allowance method and the liability methood D) the allowance method and the direct write-off method that nse 35. The following information is from the records of Pangolin Camera Shop: Accounts Receivable, December 31, 2017 Allowance for Bad Debts, December 31 2017 prior to adjustment Net credit sales for 2017 Accounts written off as uncollectible during $25,000 (debit 95 Bad expense is estimated by the aging-of-receivables method. Management estimates that $2,950 of accounts receivable will be uncollectible. Calculate the amount of net accounts receivable after the adjustment for bad debts. A) $22,950 B) $22,050 C) $21,150 D) $20,800
