step 1.

When a company estimates expected future returns, which of the following options must occur?

Cost of Goods Sold should increase.

Sales Returns and Allowances should increase.

Sales Refunds Payable should decrease.

Cost of Goods Sold should be debited.

step 2.

A company estimates bad debt using the allowance method. They determine that the current years ending balance in the allowance account is a credit of $50,000. The previous period had a credit ending balance of $22,000. What should be the amount in the adjusting entry for bad debt for the current period?

$28,000

$50,000

$72,000

$22,000

step 3:

Assume a company has the following information:

Note Receivable: $100,000

Interest Rate: 6%

Start date: June 1

Maturity date: December 31

Given this information, what is the amount of monthly interest revenue for the note?

$106,000

$3,000

$6,000

$500

step 4:

Assume a company has the following information:

Note Receivable: $200,000

Interest Rate: 3.0%

Issue Date: November 1, Year 1

Year-end: December 31, Year 1

Maturity Date: January 31, Year 2

What will be included in the journal entry on the note's maturity date?

A credit to Interest Revenue of $500

A debit to Cash of $200,500

A debit to Cash of $206,000

A debit to Cash of $200,000

step 5:

What can a company do to improve its accounts receivable turnover?

Improve utilization of long term assets

Collect on receivables more frequently

Increase gross margins

Increase cash sales