Question : 61. The Lowery Co. uses the direct write-off method of accounting : 1247228

61. The Lowery Co. uses the direct write-off method of  accounting for uncollectible accounts receivable.  The entry to write off an account that has been determined to be uncollectible would be as follows:  
A. debit Uncollectible Accounts Expense; credit Accounts Receivable
B. debit Sales Returns and Allowance, credit Accounts Receivable
C. debit Uncollectible Accounts Expense; credit Allowance for Doubtful Accounts
D. debit Accounts Receivable, credit Uncollectible Accounts Expense

62. Allowance for Doubtful Accounts has a credit balance of $500 at the end of the year (before adjustment), and uncollectible accounts expense is estimated at 3% of net sales.  If net sales are $600,000, the amount of the adjusting entry to record the provision for doubtful accounts is  
A. $18,500
B. $17,500
C. $18,000
D. none of the above

63. Under the allowance method, writing off an uncollectible account 
A. affects only income statement accounts.
B. is not acceptable practice.
C. affects only balance sheet accounts.
D. affects both balance sheet and income statement accounts.

64. An estimate based on an analysis of receivables shows that $790 of accounts receivables are uncollectible.  The Allowance for Doubtful Accounts has a debit balance of $120.  The adjusting entry at the end of the year will include a credit to Allowance for Doubtful Accounts in the amount of:   
A. $120
B. $790
C. $670
D. $910

65. 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. Uncollectible Accounts Expense
B. Allowance for Doubtful Accounts
C. Accounts Receivable
D. Interest Expense

66. 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 customers ledger indicates doubtful accounts of $16,000.  Which of the following entries records the proper provision for doubtful accounts? 
A. debit Uncollectible Accounts Expense, $800; credit Allowance for Doubtful Accounts, $800
B. debit Uncollectible Accounts Expense, $15,200; credit Allowance for Doubtful Accounts, $15,200
C. debit Allowance for Doubtful Accounts, $800; credit Uncollectible Accounts Expense, $800
D. debit Allowance for Doubtful Accounts, $16,800; credit Uncollectible Accounts Expense, $16,800

67. Allowance for Doubtful Accounts has a debit balance of $500 at the end of the year (before adjustment), and uncollectible accounts expense is estimated at 4% of net sales.  If net sales are $600,000, the amount of the adjusting entry to record the provision for doubtful accounts is  
A. $24,500
B. $23,500
C. $24,000
D. none of the above

68. After the accounts are adjusted and closed at the end of the fiscal year, Accounts Receivable has a balance of $460,000 and Allowance for Doubtful Accounts has a balance of $30,000.  What is the net realizable value of the accounts receivable? 
A. $30,000
B. $430,000
C. $460,000
D. $490,000

69. 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. Uncollectible Accounts Expense
B. Accounts Receivable
C. Allowance for Doubtful Accounts
D. Interest Expense

70. Allowance for Doubtful Accounts is listed on the balance sheet under the caption  
A. stockholders’ equity
B. investments
C. fixed assets
D. current assets