Chapter 8 & 9

Notes or accounts receivables that result from sales transactions are often called

When does an account become uncollectible?

If the direct write-off method of accounting for uncollectible receivables is used, what general ledger account is credited to write off a customer's account as uncollectible?

The Lowery Co. uses the direct write-off method of accounting for uncollectible accounts receivable. Lowery has a customer whose accounts receivable balance has been determined to likely be uncollectible. The entry to write off this account would be which of the following?

What is the type of account and normal balance of Allowance for Doubtful Accounts?

A debit balance in the Allowance for Doubtful Accounts

Under the allowance method, when a year-end adjustment is made for estimated uncollectible accounts?

An aging of a company's accounts receivable indicates the estimate of uncollectible receivables totals $7,900. If Allowance for Doubtful Accounts has a $700 credit balance, the adjustment to record the bad debt expense for the period will require a

Allowance for Doubtful Accounts has a credit balance of $2,100 at the end of the year (before adjustment), and an analysis of customers' accounts indicates uncollectible receivables of $19,700. Which of the following entries records the proper adjustment for Bad Debt Expense?

A company uses the allowance method to account for uncollectible accounts receivables. When the firm writes off a specific customer's account receivable

Allowance for Doubtful Accounts has a credit balance of $800 at the end of the year (before adjustment), and an analysis of accounts in the customer ledger indicates the estimated amount of uncollectible accounts should be $16,000. Based on the estimate above, which of the following adjusting entries should be made?

Under the allowance method of accounting for uncollectible receivables, writing off an uncollectible account.

The amount of a promissory note is called the

Interest on a note can be calculated without knowledge of the

If the maker of a promissory note fails to pay the note on the due date, the note is said to be

When a company receives an interest-bearing note receivable, it will

On August 1, Kim Company accepted a 90-day note receivable as payment for services provided to Hsu Company. The terms of the note were $20,000 face value and 6% interest. On October 30, the journal entry to record the collection of the note should include a

Accounts Receivable Turnover measures

Land acquired so it can be resold in the future is listed in the balance sheet as a(n)

Which of the following is included in the cost of constructing a building?

A building with an appraisal value of $154,000 is made available at an offer price of $172,000. The purchaser acquires the property for $40,000 in cash, a 90-day note payable for $45,000, and a mortgage amounting to $75,000. The cost basis recorded in the buyer's accounting records to recognize this purchase is:

Expenditures that add to the utility of fixed assets for more than one accounting period are

Which of the following below is an example of a capital expenditure?

All leases are classified as either

When determining whether to record an asset as a fixed asset, what two criteria must be met?

A fixed asset's estimated value at the time it is to be retired from service is called

The method of determining depreciation that yields successive reductions in the periodic depreciation charge over the estimated life of the asset is:

A machine with a cost of $68,138.00 has an estimated residual value of $5,585.00 and an estimated life of 5 years or 16,210 hours. It is to be depreciated by the units-of-production method. What is the amount of depreciation for the second full year, during which the machine was used 3,291 hours?

Equipment with a cost of $163,989.00 has an estimated residual value of $7,721.00 and an estimated life of 3 years or 15,365 hours. It is to be depreciated by the straight-line method. What is the amount of depreciation for the first full year, during which the equipment was used 3,736 hours?

A machine with a cost of $56,800.00 has an estimated residual value of $3,389.00 and an estimated life of 5 years or 17,115 hours. What is the amount of depreciation for the second full year, using the double declining-balance method?

If a fixed asset, such as a computer, were purchased on January 1st for $1,827.00 with an estimated life of 7 years and a salvage or residual value of $150.00, what is the journal entry for monthly expense under straight-line depreciation? (Note: EOM indicates the last day of each month)

Residual value is also known as all of the following except

Expected useful life is:

A fixed asset with a cost of $24,892 and accumulated depreciation of $22,403 is traded for a similar asset priced at $61,011 in a transaction with commercial substance. Assuming a trade-in allowance of $5,712, the cost basis of the new asset is

When a company sells machinery at a price equal to its book value, this transaction would be recorded with an entry that would include the following:

When a company exchanges machinery and receives a trade-in allowance less than the book value, this transaction would be recorded with the following entry:

On December 31, Strike Company has decided to sell one of its batting cages. The initial cost of the equipment was $310,000 with an accumulated depreciation of $260,000. Depreciation has been taken up to the end of the year. The company found a company that is willing to buy the equipment for $55,000. What is the amount of the gain or loss on this transaction?

Expenditures for research and development are generally recorded as

Machinery was purchased on January 1, 2010 for $51,000. The machinery has an estimated life of 7 years and an estimated salvage value of $9,000. Double-declining balance depreciation for 2011 would be