Financial Services Revision 6

Allowance for doubtful debt should be reported in :

• Balance sheet

• Cash flow statement

• Owners Equity Statement

• Income Statement

Bad debt expense should be reported in :

• Balance sheet

• Cash flow statement

• Owners Equity Statement

• Income Statement

Recording the write off of uncollectible account is the third step in the allowance method.

• True

• False

The credit Manager of Ali Company estimated that BD 8990 of account receivables will be uncollectible, the correct entry to be recorded is:

• Dr.Allowance for Doubtful Accounts & Cr.Bad debts Expense

• Dr.Bad debts Expense & Cr.Allowance for Doubtful Accounts

• Dr.Allowance for Doubtful Accounts & Cr.Account Receivable

• Dr.Account Receivable & Cr.Allowance for Doubtful Accounts

Amar furniture has an accounts receivables of BD 180000 on December 31,2019.The credit manager estimated that BD 10000 of these account receivable will be uncollectible. Then , the amount of Net account receivable is equal to :

• BD 18

• BD 170000

• BD 190000

• BD 280000

If a company is trying to collect past-due accounts, it should send demand letters to the customer.

• True

• False

When a company expects that some customers will not pay what they promised. The accounts of these customers are uncollectible accounts and called:

• Due Debts

• Poor Debts

• Bad Debts

• Big Debts

Amar furniture has an accounts receivables of BD 189000 on December 31,2019.The credit manager estimated that BD 9000 of these account receivable will be uncollectible. Then , the amount of Net account receivable is equal to :

• BD 21

• BD 198000

• BD 180000

• BD 279000

The credit Manager of Anwar Company authorized a write-off of BD 900, the correct entry to be recorded is:

• Dr.Allowance for Doubtful Accounts & Cr.Bad debts Expense

• Dr.Bad debts Expense & Cr.Allowance for Doubtful Accounts

• Dr.Allowance for Doubtful Accounts & Cr.Account Receivable

• Dr.Account Receivable & Cr.Allowance for Doubtful Accounts