acct 3 exam

When the direct write-off method of recognizing bad debt expense is used, the entry to write off a specific customer account would:

Decrease the accounts receivable balance and decrease net income

Interest Revenue on a note receivable is classified on the

Income statement under other revenues

Accounts receivable should be reported on the balance sheet as the amount due from customers (that is, the balance in the Accounts Receivable account):

less the balance in the Allowance for Doubtful Accounts account

The book value of an asset is the:

Acquisition cost of the asset less any accumulated depreciation on the asset

The adjusting entry to record uncollectible accounts expense under the allowance method would include a credit to

Allowance for Doubtful Accounts

An expenditure for the repair of an asset must be capitalized if it:

Benefits the company over several periods

The entry to write off a specific uncollectible account under the allowance method will include a credit to

act receive

the book value of an asset is equal to the

assets cost less than accumulated depreciation

Using the allowance method, writing off an actual bad debt (customer doesn't pay) account would include:

cr Accounts Receivable

Most companies pay current liabilities

out of current assets.

Under the direct write-off method of accounting for uncollectible accounts, Bad Debts Expense is debited

when an account is determined to be uncollectible.