Chapters 8-10

Term
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What type of receivables result from sales transactions?
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Terms in this set (20)
What type of receivables result from sales transactions?
trade receivables
When an uncollectible account is recovered after it has been written off, which of the following accounts will be credited in the process?
Accounts Receivable and Allowance for Doubtful Accounts
Factoring is the process of
selling accounts receivable at a discount to another party
Which one of the following is part of the transaction that is recorded when an account is written off under the allowance method?
Allowance for Doubtful Accounts is debited
Which statement is true about reporting receivables on the balance sheet?
Allowance for Doubtful Accounts is shown as a deduction from Accountings Receivables on the balance sheet
Companies are likely to choose long-term leasing over owning a piece of equipment due to
the associated tax advantages more attractive financing options
When using the straight-line depreciation method, which of the following is not a factor affecting the computation of deprecation?
book value
Which one of the following will minimize deprecations expense I the first year of owning an asset?
a long estimated life, a high salvage value, and straight-line deprecation
Which one of the following is not a depreciable asset?
supplies
If a company reports goodwill as an intangible asset on its books, what is the one thing you know with certainty?
the company purchased another company
Which of the following is true?Totals of major classes of assets can be shown in the balance sheet, with assets details disclosed in the notes to the financial statementsA corporations issued a $57100, 8%, 4-month note on July 1. The corporation's year-end is September 30. Which one of the following is the adjusting entry for interest on September 30?Dr- Interest Expense 1142 Cr- Interest Payable 1142 (57100 x 8% x 3/12)When recording payrollpayroll deductions are recorded as liabilitiesSales taxes recorded at the time the sale takes place area liabilityWhich statements describes the market interest rate?it is the rate investors demand for loaning fundsThe market price of a bond is equal to thepresent value of its principle amount plus the present value of all future interest paymentsThe market price (present value) of a bond is a function of all of the following except thelength of time until the bond is soldDiscount on Bonds Payableis a contra accountWhen a company retires bonds before maturity, the gain or loss on redemption is the difference between the cash paid and thecarrying value of the bondsA receivable that is evidenced by a formal instrument and that normally requires the payment of interest isa note receivable