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WorksheetsAccount Receivable
Total questions: 15
Worksheet time: 8mins
Accounts Receivable refer to the amounts owed by customers.
True
False
The uncollectible amount from Accounts Receivable is known as bad debts.
True
False
When does an account become uncollectible?
when the debtor fails to pay an account according to a sales contract
when the debtor fails to pay a note on the due date
there is no general rule for when an account becomes uncollectible
at the end of the fiscal year
The type of account and normal balance of Allowance for Doubtful Accounts is
contra asset, credit
liability, credit
asset, debit
expense, debit
Which of the following transactions would take place when an account becomes uncollectible and is written off under the allowance method?
Bad debts account is debited; accounts receivable is credited
Accounts receivable account is debited; sales return account is credited
Accounts receivable account is debited; an allowance for doubtful accounts is credited
Allowance of doubtful accounts is debited; accounts receivable is credited
Which of the following transactions would take place in the journal when using the direct write-off approach for an uncollectible account?
Sales account is debited; cash account is credited
Sales return account is debited; cash account is credited
Accounts receivable account is debited; sales return account is credited
Bad debts expense account is debited; accounts receivable is credited
State a proper credit term if the debtors will be given 2% discounts if making payment in 10 days after the transaction date and the credit period is 45 days.
0.02/10 ; no/45
2/10 ; n/eom
2/10 ; n/45
2%/10 ; n/45
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.
Under the direct write-off method of accounting for uncollectible accounts, Bad Debt Expense is debited
when a credit sale is past due.
when an account is determined to be uncollectible.
at the end of each accounting period.
whenever a pre-determined amount of credit sales have been made.
Bad debts can be classified as:
a current asset
a current liability
an expense
a revenue
When the allowance method is used to account for uncollectible accounts, Bad Debt Expense is debited when
a sale is made.
an account becomes bad and is written off.
management estimates the amount of uncollectibles.
a customer's account becomes past-due.
To record estimated uncollectible accounts using the allowance method, the adjusting entry would be a
debit to Accounts Receivable and a credit to Allowance for Doubtful Accounts.
debit to Bad Debt Expense and a credit to Allowance for Doubtful Accounts.
debit to Allowance for Doubtful Accounts and a credit to Accounts Receivable.
debit to Loss on Credit Sales Revenue and a credit to Accounts Receivable.
Two bases for estimating uncollectible accounts are:
percentage of current assets and percentage of sales.
percentage of assets and percentage of net sales.
percentage of receivables and percentage of net sales.
percentage of receivables and percentage of total revenue.
Bad debt recovery is
an amount of Accounts Receivable that is not collectible after the due date of credit terms
provision to estimate the uncollectible debts
amount of debt that is recovered after it has been written off or classified as bad debts
an amount of Accounts Receivable that is collectible before the due date of credit terms
Under the allowance method, writing off an uncollectible account
affects only Statement of Financial Position accounts.
affects both Statement of Financial Position and income statement accounts.
affects only income statement accounts.
is not acceptable practice.
