Multiple choice questions on accounts receivables
1. The allowance for uncollectible accounts is a
a.deferred charge to expense.
b.contra asset account.
c.deferred revenue account.
d.contra-liability.
2. Which of the following is recorded by a credit to Accounts receivable?
a.Sale of inventory on account.
b.Estimating the annual allowance for doubtful accounts.
c.Estimating annual sales returns.
d.Write-offs of bad debts.
3. Collections of accounts receivable that previously have been written off are credited to:
a.a gain account.
b.accounts receivable.
c.bad debts expense.
d.retained earnings.
4. Which of the following do not change the balance in Accounts receivable?
a.Returns on credit sales
b.Collections from customer accounts
c.Bad debts expense adjustment
d.Write-offs
5. Market, Inc. received two notes from customers for sales that it made to them in 2008. The notes included:
Note A: Dated 5/31/08, principal of $120,000 and interest due 3/31/09.
Note B: Dated 7/1/08, principal of $200,000 and interest at 8% annually, due on 4/1/09.
Market reported accrued interest receivable from these notes of $14,400 on its 12/31/08 balance sheet. What is the annual interest rate on Note A?
a.9.14%
b.8%
c.9.74%
d.9.44%