Accounting

P. Jameson Co. sold $500 of merchandise on Master Card credit sales. The net cash receipts from the sale are immediately deposited in the seller's bank account. Master Card charges a 4% fee. The journal entry to record this sales transaction would include a:

- Credit to sales for $500 - debit to credit card expense for $20 - debit to cash for $480

On February 15, Symth Co. determines that it cannot collect $500 owed by its customer, A. Winds. Symth records the loss using the direct write-off method. This entry to record the write-off on February 15 would include a:

- Debit to bad debts expense - credit to accounts receivable- A. Winds

The two most common receivables are _____ receivable and ______ receivable

- accounts - notes

In July, Lane Co. sells merchandise to Avery Co. on account. In August, Avery pays the balance in full. The entry that Lane will make to record the receipt of cash will include a credit to the ___ accounts

- accounts receivable

Dea Company sold $1,000 of merchandise to a customer who used Dea Company's credit card. The entry to record this transaction on the date of the sale would include:

- accounts receivable in the amount $1,000 - sales in the amount of $1,000

Bad debts are:

- an expense of selling on credit - accounts of costumers who do not pay - also allied uncollectible accounts

On August 1, Hanes Co. determines that it cannot collect $150 from a customer. Hanes uses the direct write-off method. Hanes will record the write-off or this account by debiting:

- bad debts expense for $150

To record a customer's check in full payment for a sale that was made the prior month, the company should debit the ____________ account.

- cash

JD Co. had $1,000 of credit cards sales. The net cash receipts were deposited immediately into JD Company's bank account less a 3% fee. The entry to record this sales transaction would include the following debit entries.

- cash $970 - credit card expense for $30

I. Whitlock Co. had $1,000 of credit cards sales. The net cash receipts were deposited immediately into Whitlock's bank account less than a 5% fee. The entry to record this sales transaction would include a debit to:

- credit card expense in the amount of $50

A. Stone Co. previously wrote off $200 bad debt from Thorn Co. using the direct write-off method. On October 1, Stine unexpectedly receives a check in the amount of $200 from Thorn Co. The entry record this receipt of $200 will include a:

- credit to bad debts expense - debit to cash

The direct write-off method records bad debts expense only when an account becomes uncollectible, which is not always in the same period as the sale. For this reason, the direct write-off method violates the _____ _______ principle.

- expense or matching - recognition

accounts receivable ledger

- is a supplementary record to maintain an account for each customer - records journal entries that affect accounts receivable

(Bad/Invalid) (collectible/debts) are accounts of customers who do not pay what they have promised to pay. It's considered an expense of selling on credit.

-Bad -Dept

Zion company sells merchandise on account to BRC, Inc, in the amount of $1,200. The entry to record this sale would include:

-debit to accounts receivable -credit to sales

Thomas Co. sold $1,000 worth of merchandise on a bank credit card less a 3% fee. The entry to record the sales transaction would include a debit to Cash in the amount of $.

970

Simon Co. sold $500 of merchandise on their own store credit cards. The entry to record this sales transaction on the date of the sale would include a debit to:

Accounts Receivable for $500

A(n) ______ is a supplementary record created to maintain a separate account for each customer.

Accounts receivable ledger

The ______ method of accounting for bad debts matches the estimated loss from uncollectible accounts receivable against the sales they helped produce

Allowance

In august, Johns Co.'s account receivable balance was written off using the direct method. In November, johns pays the balance in full. The journal entry to record the reinstatement of the account receivable must include a credit to the _______ _______ ______ account before recording a debit to the cash account

Bad debts expense

To record a customer's check in full payment for a sale that was made the prior month, the company should debit the _____ account

Cash

T. Hillcrest Co. sold $500 of merchandise on a bank credit card less a 5% fee. The entry to record this sales transaction would include debit(s) to:

Cash for $475 and Credit Card Expense for $25

The direct write-off method records bad debts expense only when an account becomes uncollectible, which is not always in the same period as the sale. For this reason, the direct write-off method violates the ____ principle

Expense recognition

The allowance method of accounting for bad debts records the loss from an uncollectible account receivable when it determines to be uncollectible. No attempt is made to predict bad debts

False

The allowance for doubtful accounts is a contra asset account that equals

Total uncollectible accounts

Ace Company sells merchandise to a customer in the amount of $200 on credit, terms n/30. The entry to record this sale would include a debit to the ____________ account:

accounts receivable

The ____ method of accounting for bad debts records the loss from an uncollectible account receivable when it is determined to be uncollectible. No attempt is made to predict bad debts expense.

direct write-off