1. JKL Company completes an aging schedule of its Accounts Receivable in

order to determine the year-end adjustment for bad debts expense. At the end

of 2022, management estimates from the aging schedule that $14,750 of the

Accounts Receivable balance will be uncollectible. The Allowance for

Doubtful Accounts account has a debit balance (before adjustment) of $175.

What adjusting journal entry should JKL make on December 31, 2022 to record

bad debts expense?

a. Bad Debts Expense -------------------------------------------- 14,750

Allowance for Doubtful Accounts --------------------- 14,750

b. Bad Debts Expense -------------------------------------------- 14,575

Allowance for Doubtful Accounts --------------------- 14,575

c. Bad Debts Expense -------------------------------------------- 14,925

Allowance for Doubtful Accounts --------------------- 14,925

d. Accounts Receivable ------------------------------------------- 14,750

Bad Debts Expense --------------------------------------------- 175

Allowance for Doubtful Accounts ---------------------- 14,925

e. Accounts Receivable ------------------------------------------- 14,925

Allowance for Doubtful Accounts ---------------------- 14,925

2. On March 5, 2022, MNO Company accepted a $3,000, 2-month, 10%

note in granting a time extension on the past-due Accounts Receivable of

Vasilika Dhami. On May 5, 2022, Vasilika Dhami paid the maturity value of her

$3,000 note. What is the journal entry made by MNO Company to

record the payment of the note? (All interest is paid at maturity).

a. Cash --------------------------------------------------------------- 3,000

Interest Revenue ---------------------------------------------- 50

Notes Receivable - V.Dhami -------------------------- 3,050

b. Cash -------------------------------------------------------------- 3,300

Interest Revenue ----------------------------------------- 300

Notes Receivable - V. Dhami --------------------------- 3,000

c. Cash --------------------------------------------------------------- 3,050

Interest Revenue ----------------------------------------- 50

Notes Receivable - V. Dhami --------------------------- 3,000

d. Cash --------------------------------------------------------------- 3,300

Notes Receivable - V. Dhami --------------------------- 3,300

e. Cash --------------------------------------------------------------- 3,050

Accounts Receivable - V. Dhami ---------------------- 3,050

3. The journal entry to record the purchase on account of merchandise for

resale of $1,000, plus HST of 13% (assuming a perpetual inventory system)

is:

a. Merchandise Inventory -------------------------------------- 1,130

Accounts Payable ----------------------------------------- 1,130

4. The journal entry to record the return of $500 of the merchandise

purchased in Question #10 to the supplier is:

a. Accounts Payable ---------------------------------------------- 565

HST Recoverable ------------------------------------------ 65

Merchandise Inventory ---------------------------------- 500

b. Accounts Payable ---------------------------------------------- 565

Merchandise Inventory --------------------------------- 565

c. Accounts Payable ---------------------------------------------- 565

HST Recoverable ------------------------------------------ 65

Purchase Returns and Allowances -------------------- 500

d. Accounts Payable ---------------------------------------------- 500

HST Payable ----------------------------------------------------- 65

Merchandise Inventory ---------------------------------- 565

b. Merchandise Inventory -------------------------------------- 1,130

Accounts Payable ----------------------------------------- 1,000

HST Recoverable ------------------------------------------ 130

c. Merchandise Inventory -------------------------------------- 1,000

HST Payable ----------------------------------------------------- 130

Accounts Payable ----------------------------------------- 1,130

d. Merchandise Inventory ------------------------------------- 1,000

HST Recoverable ---------------------------------------------- 130

Accounts Payable ---------------------------------------- 1,130

.5. The journal entry by a grocery store to record the cash purchase for $1,000

(plus HST of 13%) of equipment for storing food in the store is:

a. Equipment -------------------------------------------------------- 1,000

HST Recoverable ------------------------------------------------ 130

Cash ------------------------------------------------------- 1,130

b. Equipment ------------------------------------------------------- 1,000

HST Payable ----------------------------------------------------- 130

Cash ------------------------------------------------------ 1,130

c. Equipment ------------------------------------------------------- 1,130

Cash ------------------------------------------------------- 1,130

d. Equipment -------------------------------------------------------- 1,130

HST Recoverable ------------------------------------------------ 130

Cash ------------------------------------------------------- 1,000