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WorksheetsREVISION 3 : TOPIC 7, 8 & 9
Total questions: 20
Worksheet time: 10mins
What are the double entries to record bad debt?
dr. Bad Debt, cr. Allowance for Doubtful Debts
dr. Profit and Loss, cr. Bad Debt
dr. Bad debt, cr. Profit and Loss
dr. Bad debt, cr. Accounts Receivable
The double entries to record an increase in allowance for bad debts are?
dr. Accounts Receivables, cr. Allowance for doubtful debts
dr. Bad debt, cr. Allowance for doubtful debts
dr. Allowance for bad debt, cr. Accounts Receivables
dr. Allowance for doubtful debts, cr. Bad debt
Bad debts can be classified as:
a current asset
a current liability
an expense
a revenue
% of provision X ending balance of Accounts Receivable = ?
beginning balance of Bad Debt Expense
beginning balance of Allowance for Doubtful Debts
Bad Debt Expense
ending balance of Allowance for Doubtful Debts
Bad Debts Recovery is the account to be credited when the uncollectible amount that has been confirmed as Bad Debts suddenly can be collected.
True
False
Two methods of accounting for uncollectible accounts are the
allowance method and the accrual method.
direct write-off method and the accrual method.
direct write-off method and the allowance method.
allowance method and the net realizable method.
The journal entry for recording accounts receivable is:
Dr. Sales; Cr. Accounts Receivable
Dr. Accounts Receivable: Cr. Sales
Dr. Cash; Cr. Sales
Dr. Sales; Cr. Accounts Payable
Beginning inventory plus the cost of goods purchased equals
cost of goods sold.
cost of goods available for sale.
net purchases.
total goods purchased.
If a company is experiencing continuous cost increases for the merchandise that it purchases, which costing method assumption will result in the least amount of profit and the least amount of income tax expense?
LIFO
FIFO
Weighted Average
The inventory system that does NOT update the Inventory account automatically at the time of each purchase or sales is the _______________ system.
periodic
perpetual
Which of the following is suitable to explain the effects on inventory valuation on profit?
Ending inventory costs high → COGS high → Gross profit low
Ending inventory costs high → COGS low → Gross profit high
Ending inventory costs low → COGS low → Gross profit high
Ending inventory costs low → COGS high → Gross profit high
Ending inventory costs high → COGS low → Gross profit low
In periodic inventory system, what entries are made to record sales returns.
debit cost of goods sold ; credit inventory
debit sales returns; credit accounts receivable
debit inventory ; credit cost of goods sold
debit inventory; credit accounts receivable
debit sales returns; credit cost of goods sold
The following are considered to be a revenue expenditures except :
costs of goods purchased from a supplier
salary paid to a clerk
installation costs of an air-conditioner in the office
costs of repainting the office
Intangible non-current assets
cannot be substantially touched but are significant to the company
can be converted to cash within one year
are to be used in a daily operation and to pay ongoing expenses
include accounts receivable, inventory, prepaid expenses and cash
The gain from disposal of non-current assets is obtained when _____________.
the selling price is less than the net book value of the asset
the selling price is exceed the net book value of the asset
the net book value is greater than the depreciation of the asset
the depreciation is lower than the residual value of the asset
If Revenue Expenditure are wrongly classified as Capital Expenditure :
The expenses will be overstated
the net profit will be understated
The Non Current Assets & the capital of organization will be understated
The Non Current Assets & the capital of organization will be overstated
The following should be added in the calculation of true cost of NCA except
Shipping charges
Installation charges
Admin expenses
sales tax
An asset whose life will extend over more than one accounting period is called a
liability
current asset
non current asset
non current liability
The balance of the Accumulated Depreciation account represents:
a non-current liability
a cash fund accumulated to replace worn-out or obsolete non-current assets
an expired cost of the non-current assets purchased in previous accounting periods
an operating expense of the business.
Bad Debt Expense will be reported in Statement of Profit or Loss under which category?
Cost of Goods Sold
Net Sales
Other Expenses
Operational Expenses
