Financial Accounting Chapter 9 Quiz TRUE/FALSE 1) The expense recognition (matching) principle requires use of the allowance method of accounting for bacd Name debts. 1) 2) As long as a company accurately records total credit sales information, it is not necessary to have separate accounts for specific customers. 2) 3) A comp any borrowed $10,000 by signing a six-month promissory note at 5% interest. The amount of interest to be paid at maturity is $25. 3) Problem 4) A compan uncollectible accounts. Experience suggeststhat 6% of outstanding receivables are uncollectible. The current credit balance (before adjustments) in the allowance for doubtful accounts is $1,200. The journal entry to record the adjustment would be how much? y has $80,000 in outstanding accounts receivable and it uses the allowance method to account for T or F 5) A company borrowed S 16,000 by signing a 4-month promissory note at 12%. The amount of interest to be paid at maturity is $640. 5) T or F 6) BizCom's customer, Redding, paid off an $8,300 balance on its account receivable. BizCom should record th transaction as a debit to Accounts Receivable-Redding and a credit to Cash. 6) Problem 7) A company has $80,000 in outstanding accounts uncollectible accounts. Experience suggests that 6% of outstanding receivables are uncollectible. The current debit balance (before adjustmen the adjustment would be how much? receivable and it uses the allowance method to account for ts) in the allowance for doubtful accounts is $1,200. The journal entry to record T or F 8) No attempt is made to estimate bad debts expense under the allowance method of accounting for uncollectible accounts receivable. 8) T or F 9) Allowance for Doubtful Accounts is a contra asset, its balance is added to Accounts receivable. 9) Tor F 10) The aging of accounts receivable involves classifying each account receivable by how long it is past its due date and estimating the percent of each uncollectible class. 10)