Accounting 251

uncollectible accounts.

The allowance method estimates

In either current or noncurrent assets, as appropriate.

Where is a note receivable reported in the balance sheet?

Loans by a company to other entities Interest due from loans to customers

Which of the following are classified as receivables?

Amounts loaned and expected to be repaid Tax refund claims Amounts owed by customers

Which of the following items are classified as receivables?

note receivable.

A formal, signed credit agreement between a lender and a borrower is called a(n) _____ by the lender.

in the balance sheet as assets.

Accounts receivable are normally classified

they will be converted to cash within 1 year.

Accounts receivable are typically classified as current assets because

account receivable.

An informal credit arrangement with a customer for payment to be received after the sale is classified as a(n)

at the point of delivery.

For a typical credit sale, the seller records revenue

Delay in collecting accounts Uncollectible accounts

Identify the likely disadvantages of extending credit to customers. (Select all that apply.)

sales on account. credit sales.

Sales to customers in which the customers pay within 30 to 60 days are referred to as (Select all that apply.)

the company has provided goods or services to the customer. collection from the customer is probable.

The two conditions that must exist for a sale and the related receivable to be recognized are

True

True or false: Credit sales tend to increase sales and profitability in the long-run.

interest-bearing higher likelihood of collectibility

What comparative advantages do notes receivables possess compared to other receivables? (Select all that apply.)

credit sales.

When a business provides services to a customer, and the customer promises to pay later, this is referred to as