Wholesome and Happy Foods is a farm-to-family grocery store located in the Pacific Northwest. The company recently installed four self-checkout lanes that allow customers to scan their own groceries and pay for their purchases using an automated checkout kiosk. The kiosks are monitored by a single attendant. In recent weeks, management has become concerned that some customers are not scanning all of the items that they bring through the self-checkout lanes.

Write a brief memo to your instructor suggesting features and capabilities for the kiosks that would serve as control procedures, ensuring that all items brought through the self- heckout lanes are properly scanned and purchased.

4. Under the allowance method, an adjusting entry is made for uncollectible accounts. When an account is determined to be uncollectible, it is written off against the allowance account. The allowance account is a contra asset account that normally has a credit balance after the adjusting entry has been posted. The estimate of uncollectibles may be based on a percent of sales or an analysis of receivables. Exhibit 3 compares and contrasts these two methods.

5. Exhibit 4 illustrates the differences between the direct write-off and allowance methods of accounting for uncollectible accounts.

6. A note received to settle an account receivable is journalized as a debit to Notes Receivable and a credit to Accounts Receivable. When a note is paid at maturity, Cash is debited, Notes Receivable is credited, and Interest Revenue is credited. If the maker of a note fails to pay, the dishonored note is journalized by debiting an account receivable for the amount due from the maker of the note.

7. All receivables that are expected to be realized in cash within a year are reported in the current assets section of the balance sheet. In addition to the allowance for doubtful accounts, additional receivable disclosures include the market (fair) value and unusual credit risks.