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ACC 210 PS Chapter 5 Quiz

Authored by Rebecca Brown

Business

University

Used 2+ times

ACC 210 PS Chapter 5 Quiz
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17 questions

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1.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

True or False: "Sales Returns" and "Sales Allowances" are expense accounts

TRUE

FALSE

2.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

What is the correct Accounts Receivable Turnover Formula?

Net Credit Sales/ Avg Accts Rec

365/Receivable Turnover Ration

Cost of Goods Sold/ Avg Inventory

Sales/ Avg Net PP&E

3.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

When the seller records a sales return for merchandise, two journal entries are required.

True

False

4.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

Sales Returns and Allowances is classified as a

revenue account

owner's equity account

contra revenue account

none of the above

5.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

Which of the following statements is  true?

Accounts receivable are liabilities.
Notes receivable usually have longer collection terms than accounts receivable.
Accounts receivable are more liquid than cash.
Notes receivable are always classified as current assets.

6.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

When a company is using the direct  write-off method, and an account is written  off, the journal entry consists of a  ________.

credit to Accounts Receivable and a debit to Bad Debts Expense
debit to the Allowance for Bad Debts and a credit to Accounts Receivable
debit to Accounts Receivable and a credit to Cash
credit to Accounts Receivable and a debit to Interest Expense

7.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

Which of the following statements is true of the direct​ write-off method?

It results in more accurate net income than any other method.
It is only suitable for small companies that have very few uncollectible receivables.
GAAP requires public companies to follow the direct​ write-off method.
It provides better matching of revenues with expenses.

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