Question : 21) If the allowance method of accounting for uncollectible receivables : 1171042

21) If the allowance method of accounting for uncollectible receivables is used, what general ledger account is credited to write off a customer’s account as uncollectible?

A) Bad Debts Expense

B) Accounts Receivable

C) Accounts Payable

D) Bad Debts Recovered

22) If the allowance method of accounting for uncollectible receivables is used, what general ledger account is debited to write off a customer’s account as uncollectible?

A) Allowance for Doubtful Accounts

B) Bad Debt Expense

C) Accounts Payable

D) Bad Debts Recovered

23) Colleen’s account was written off for $800. She received an inheritance from her uncle and wants to clear her account. The entry to record this is to:

A) debit Cash and credit Accounts Receivable/Colleen.

B) debit Allowances for Doubtful Accounts, credit Accounts Receivable/Maggie, debit Cash, and credit Accounts Receivable/Colleen.

C) debit Accounts Receivable/Colleen, credit Allowance for Doubtful Accounts, debit Cash, and credit Accounts Receivable/Colleen.

D) debit Accounts Receivable/Colleen, credit Allowance for Doubtful Accounts, debit Accounts Receivable/Colleen, and credit Cash.

24) As the past due time increases for an account, the likelihood of collecting that account:

A) usually goes down

B) usually goes up.

C) Time does not affect collectibility.

D) None of the above

25) After aging the receivables, Tim’s Toys estimates that $1,900 will not be collected and the allowance account has a debit balance of $525. The adjusting entry would be for:

A) $1,900.

B) $525.

C) $2,425.

D) $1,375.

26) A detailed analysis of Accounts Receivable to determine how long each account has been outstanding is called:

A) aging the Accounts Receivable.

B) aging the uncollectible accounts.

C) analyzing the Accounts Receivable.

D) taking a percentage of sales on account.

27) A notice was received from Mary, who is a customer, that she was bankrupt. If using an allowance method, the entry to write-off her balance of $1,250 would be:

A)

Bad Debt Expense

1,250

Allowance for Doubtful Accounts

1,250

B)

Accounts Receivable/Mary

1,250

Bad Debt Expense                            

1,250

C)

Allowance for Doubtful Accounts

1,250

Accounts Receivable/Mary           

1,250

D) None of the above

28) After aging the Accounts Receivable, it is estimated that $2,450 will not be collected and the allowance account has an existing debit balance of $300. If Accounts Receivable is $107,000, the net receivables would be:

A) $107,000.

B) $106,900.

C) $104,550.

D) $104,250.

29) Empire has a credit balance of $450 in its Allowance for Doubtful Accounts. The balance in the Accounts Receivable account is $92,500, with $2,015 estimated to be uncollectible after aging the accounts. Under the balance sheet approach, the debit to Bad Debt Expense will be:

A) $450.

B) $2,465.

C) $2,015.

D) $1,565.

30) The income statement approach estimates a percentage of Accounts Receivable that is uncollectible.