In 20X5 a company had sales revenues of $550,000, of which 70% was on account. At 12/31/X5 the following ending balances before adjustment were available:

DR CR

Accounts Receivable $70,000

Allowance for Uncollectible 700

Accounts

The Accounts Receivable aging reflects:

Balance% estimated to be Uncollectible

Current 38,000 2%

1-30 days past due 12,000 4%

31-60 days past due 9,000 10%

over 60 days 11,000 30%

Given the information above, the 12/31/X5 adjusting entry for uncollectible accounts based on the aging percentages provided would include a debit to Bad Debt Expense of

$6,140.

$5,440.

$4,740.

$5,000.

none of these

16.

Which of the following is true of the Allowance for Uncollectible Accounts account?

It is a "nominal" or income statement account.

It is a contra-revenue account.

It may have a debit balance at year endfollowingthe adjustment for estimated uncollectible accounts receivable.

Its balancefollowingthe year end adjustment should reflect an estimate of the amount of ending accounts receivable that will ultimately prove to be uncollectible.

none of these

A debit balance in the Allowance for Uncollectible Accounts account before the year end adjustment for the current year's uncollectible accounts expense means

that the prior year's estimated uncollectible accounts receivable must have been overestimated.

that the prior years estimated uncollectible accounts receivable must have been underestimated.

that the current years write-offs of uncollectible accounts receivable were less than the prior year's ending allowance for uncollectible accounts balance.

that the direct write-off rather than the allowance method was used to account for uncollectible receivables.

18.

The journal entry to record the write-off of an uncollectible receivable under the allowance method would involve the following accounts as indicated:

a. Allowance for Uncollectible Accounts xx

Uncollectible Accounts Expense xx

b. Allowance for Uncollectible Accounts xx

Accounts Receivable xx

c. Uncollectible Accounts Expense xx

Allowance for Uncollectible Accounts xx

d. Uncollectible Accounts Expense xx

Accounts Receivable xx

a

b

c

d

none of these