CSO 2.6

After the accounts are adjusted and closed at the end of the fiscal year, Accounts Receivable has a balance of $340,000 and Allowance for Doubtful Accounts has a balance of $51,000. What is the net realizable value of the 424 31 accounts receivable? 425 426 A. 289,000 427 391,000 428 340,000 429 D. 51,000 430 436 Tanning Company analyzes its receivables to estimate bad debt expense. The accounts receivable balance is $390,000 and credit sales are $1,300,000. An aging of accounts receivable shows that approximately 5% of the outstanding receivables will be uncollectible. What adjusting entry will Tanning Company make if the Allowance for 437 32 Doubtful Accounts has a credit balance of $2,500 before adjustment? 438 439 A. Dr. Bad Debt Expense 19,500 440 Cr. Allowance for Doubtful Accounts 19,500 441 B. Dr. Bad Debt Expense 65,000 442 Cr. Allowance for Doubtful Accounts 65,000 443 C. Dr. Bad Debt Expense 22,000 444 Cr. Allowance for Doubtful Accounts 22,000 445 D. Dr. Bad Debt Expense 17,000 446 Cr. Allowance for Doubtful Accounts 17,000 447 448 462 463 33. The amount of the promissory note plus the interest earned on the due date is called the 464 465 A. maturity value 466 B. issuance value 467 C. face value 468 D. interest value 469 470 471 34. The joumal entry to record a note received from a customer to replace an accounts receivable is 472 473 A. Dr. Accounts Receivable 474 Cr. Notes Receivable 475 B. Dr. Notes Receivable 476 Cr. Notes Payable 477 C. Dr. Cash 478 Cr. Notes Receivable 479 D. Dr. Notes Receivable 480 Cr. Accounts Receivable 481 482 Harper Company lends Hewell Company $40,000 on March 1, accepting a four-month, 6% interest note. Harper Company prepares financial statements on March 31. What adjusting entry should be made before the financial 483 35 statements can be prepared? 484 485 A. Dr. Interest Receivable 800 486 Cr. Interest Revenue 800 487 B. Dr. Note Receivable 40,000 Cr. Cash 40,000 489 C Dr. Interest Receivable 200 490 Cr. Interest Revenue 200 491 D. Dr. Cash 200 492 Cr. Interest Revenue 200