The Super power electricity company provides service during the period and bills its customers for the consumption which amounts to RO 50,000. The utility estimates that 8.5% of its billings will not be collected. During the year, the water utility acquired a new generator costing OMR 8000. The vouchers were approved and payment was settled after one week of purchase.

1)

If the revenues are reported net of uncollectible, which among the following will be the correct journal entry to record revenue from electric utility services?

a.

Accounts receivable (Debit) 45,750

Allowances for uncollectibles (Credit) 4250

Electric utility sales revenue (Credit) 41,500

b.

Accounts receivable (Debit) 50,000

Allowances for uncollectibles (Credit) 4250

Electric utility sales revenue (Credit) 45,750

c.

Accounts receivable (Debit) 41,500

Allowances for uncollectible (Credit) 4250

utility sales revenue (Credit) 37,250

d.

Accounts receivable (Debit) 54,250

Allowances for uncollectibles (Credit) 4250

Electric utility sales revenue (Credit) 50,000

2)

The entry to record payment to vendor is:

a.

Expenses (Debit) 8000

Vouchers payable (Credit) 8000

b.

Cash (Debit) 8000

Vouchers payable (Credit) 8000

c.

Vouchers payable (Debit) 8000

Cash (Credit) 8000

d.

Vouchers payable (Debit) 8000

Expenses (Credit) 8000

3)

The journal entry passed at the time of acquisition of generator is:

a.

Expenditures (Debit) 8000

Cash (Credit) 8000

b.

Vouchers payable (Debit) 8000

Equipment (Credit) 8000

c.

Equipment (Debit) 8000

Cash (Credit) 8000

d.

Equipment (Debit) 8000

Voucher payable (Credit) 8000