TRUE OR FALSE

1 .accounts receivable is recorded as the net of sales returns.

2. The percentage of Sales (or net credit sales) method uses the past relationship between bad debts and net credit sales to predict bad debt amounts.

3. NBC Company started operations in Dec 2019 & recorded the following transactions during the period: -Cash Sales $50,000, -Credit Sales $75,000, -Estimated percentage of net credit sales that will be uncollectible is 10%, -Collections attributed to credit sales $5,000, -Returns attributed to credit sales $7,000, -Write offs of uncollectible accounts $6,000. TRUE OR FALSE: net total sales at the end of Dec 2019 is equal to $125,000.

4. NBC Company started operations in Dec 2019 & recorded the following transactions during the period: -Cash Sales $50,000, -Credit Sales $75,000, -Estimated percentage of net credit sales that will be uncollectible is 10%, -Collections attributed to credit sales $5,000, -Returns attributed to credit sales $7,000, -Write offs of uncollectible accounts $6,000. TRUE OR FALSE: Net accounts receivable balance under the direct-write off method at the end of Dec 2019 is equal to $75,000.

5. NBC Company started operations in Dec 2019 & recorded the following transactions during the period: -Leasehold improvements $50,000, -Patent $40,000, -Buildings $100,000, -Machinery $65,000, Trademark $35,000. TRUE OR FALSE: Assuming depreciation has been factored in the information above, net total operating assets are equal to $215,000.

6. The percentage of accounts receivable approach estimates sales by relating them to the balance in the accounts receivable.

7. NBC Company started operations in Dec 2019 & recorded the following transactions during the period: -Cash Sales $50,000, -Credit Sales $75,000, -Estimated percentage of net credit sales that will be uncollectible is 10%, -Collections attributed to credit sales $5,000, -Returns attributed to credit sales $7,000, -Write offs of uncollectible accounts $6,000. TRUE OR FALSE: Net accounts receivable balance under the allowance method at the end of Dec 2019 is equal to $56,200.