On May 1, 2019, Carol Company sold merchandise to Samer Company for $8,000 on account, credit terms 2/10, n/30. On May 4, 2019, Samer Company returned merchandise worth $2,000. On May 15, 2019, Samer Company paid in full the amount due to Carol Company.

1- The journal entry on May 1, 2019, will include: *

Debit Cash, Credit Sales Revenue.

Credit Sales Revenue, Debit Accounts Receivable.

Debit Cash, Debit Sales Discount, Credit Accounts Receivable.

Debit Sales Returns and Allowances, Credit Accounts Receivables.

None of the above

2- The sales discount amount granted to Samer Company at the payment date is equal to: *

$800

$160

$40

$120

No sales discount

3- Cash paid by Samer Company on May 15, 2019 is equal to: *

$8,000

$2,000

$6,000

$7,840

None of the above

case study 2

On February 28, MAZ Co. had Net sales of $3,000,000. Credit sales for February amounted 30% of Net sales. The credit manager estimated that uncollectible accounts expense would amount to 10% of net credit sales made during February. On March 10, an account receivable from Kate for $6,000 was determined to be uncollectible and written off.

1- In the adjusting entry, Bad Debt Expense is: *

Debited for: $60,000

Debited for: $6,000

Credited for: $600,000

Credited for: $300,000

None of the above

2- The write-off of Kate account is journalized as: *

Debit: AR $6,000 and Credit: Cash $6,000

Debit: AR $6,000 and Credit: Bad Debt Expense $6,000

Debit: AFDA $6,000 and Credit: AR $6,000

Debit: Bad Debt Expense $6,000 and Credit: AFDA $6,000

None of the above

case study 3

On August 1, 2019, Treasure Company borrowed $80,000 cash from MB Bank by issuing an 8-month, 6% interest-bearing note. At maturity date, the company paid the full amount due. The company prepares its financial statement annually at the end of December.

1- The adjusting entry to record the accrued interest: *

Debit Interest Expense and Credit Interest Payable for $3,200.

Credit Interest Expense and Debit Interest Payable for $4,800

Debit Interest Expense and Credit Interest Payable for $2,000.

Credit Cash and Debit Notes Payable for $80,000.

None of the above

2- The maturity date of the note is: *

March 1, 2020

April 1, 2020

May 1, 2020

None of the above

3- At maturity date, interest payable amount is: *

$4,800

$3,200

$2,000

$1,200

None of the above

4- At maturity date, cash paid will be recorded as: *

Debit Cash for $84,800

Credit Cash for $83,200

Debit Cash for $82,000

Credit Cash for $80,000

None of the above

case study 4:

Valley Company sold merchandise on account to Alain Inc. for $156,000 plus 4% sales taxes.

1- Sales taxes amount is: *

$150,000

$6,240

$6,000

$4,000

None of the above

2- Total amount received is: *

$162,240

$160,000

$150,000

$156,000

None of the above

3- Journal entry to record the sale is: *

Debit Accounts Receivable, Credit Sales Revenue, Credit Sales Taxes Payable.

Credit Cash, Debit Sales Taxes Payable.

Debit Cash, Credit Sales Revenue, Credit Sales Taxes Payable.

Debit Cash, Credit Sales Taxes Payable.

None of the above