Question 1)

GrievesCompany has the following items at year end:

Cash in bank$42,000

Petty cash1,500

Short-term paper with maturity of 2 months6,500

Postdated cheques3,400

Grievesshould report cash and cash equivalents of

$46,600.

$43,500.

$42,000.

$50,000.

Question 2)

Using the allowance method, when an account receivable is written off, the account to be debited is

allowance for doubtful accounts.

bad debts expense.

cash.

accounts receivable.

Question 3)

What is the normal journal entry for recording bad debt expense under the allowance method?

debit Allowance for Doubtful Accounts, credit Bad Debt Expense

debit Bad Debt Expense, credit Allowance for Doubtful Accounts

debit Allowance for Doubtful Accounts, credit Accounts Receivable

debit Accounts Receivable, credit Allowance for Doubtful Accounts

Question 4)

The following accounts were included on Mali Co.'sunadjustedtrial balance at December 31, 2020:

DebitCreditAccounts receivable

$850,000Allowance for doubtful accounts

11,000Net credit sales$2,950,000

Mali estimates that 1.5 % of the gross accounts receivable will become uncollectible. After the proper adjustment at December 31, 2020, the allowance for doubtful accounts should have a credit balance of

$23,750.

$ 1,750.

$12,750.

$11,000.

Question 5)

Which of the following statements is correct?

A note is signed by the payee in favor of the maker.

There is no interest included in a zero-interest-bearing note.

A long-term note's fair value and present value are always the same.

All notes contain an interest element because of the time value of money.