Q41

On February 1, a customer's account balance of $4000 was deemed to be uncollectible. What entry should be recorded on February 1 to record the write-off assuming the company uses the allowance method?

		Debit Allowance for Doubtful Accounts $4000; credit Accounts Receivable $4000.
		Debit Bad Debts Expense $4000; credit Accounts Receivable $4000.
		Debit Allowance for Doubtful Accounts $4000; credit Bad Debts Expense $4000.
		Debit Accounts Receivable $4000; credit Allowance for Doubtful Accounts $4000.
		Debit Bad Debts Expense $4000; credit Allowance for Doubtful Accounts $4000.

On January 1, $362,400 of par value bonds with a carrying value of $388,000 is converted to 60,400 shares of $5 par value common stock. The entry to record the conversion of the bonds includes all of the following entries except:

		Credit to Common Stock $302,000.
		Credit to Paid-In Capital in Excess of Par Value, Common Stock $86,000.
		Debit to Bonds Payable $388,000.
		Debit to Premium on Bonds Payable $25,600.
		Debit to Bonds Payable $362,400.

Childers Company, which uses a perpetual inventory system, has an established petty cash fund in the amount of $500. The fund was last reimbursed on November 30. At the end of December, the fund contained the following petty cash receipts:

December 4	Freight charge for merchandise purchased	$	56.00
December 7	Delivery charge for shipping to customer	$	80.00
December 12	Purchase of office supplies	$	45.00
December 18	Donation to charitable organization	$	64.00

If, in addition to these receipts, the petty cash fund contains $246.00 of cash, the journal entry to reimburse the fund on December 31 will include:

		A credit to Cash Over and Short of $9.00.
		A debit to Transportation-In of $101.
		A credit to Office Supplies of $80.
		A debit to Petty Cash of $101.
		A credit to Cash of $254.00.

Chang Industries has bonds outstanding with a par value of $212,800 and a carrying value of $222,200. If the company calls these bonds at a price of $217,000, the gain or loss on retirement is:

		$4200 loss.
		$4200 gain.
		$9400 gain.
		$5200 gain.
		$5200 loss.