Question

16. The Allowance for Bad Debts account has a debit balance of $7,000 before the adjusting entry for bad debts expense. After analyzing the accounts in the accounts receivable subsidiary ledger using the aging-of-receivables method, the company's management estimates that uncollectible accounts will be $15,000. What amount of bad debts expense will be reported on the income statement?

19. In reviewing the T-account for Accounts Receivable, you find that the beginning balance is zero, the total increases are $4,900 and the total decreases are $2,400. This means that the ending balance of the account is a credit balance of $2,500.

True

False

29. An invoice is also known as a bill.

True

False

30. A cash equivalent is a highly liquid investment that can be converted into cash in three years or less.

True

False

32. Which of the following is true of a purchases journal?

A.Cash purchases are recorded in the purchases journal.

B.For a periodic inventory system, the Merchandise Inventory DR column is replaced with a column titled Cost of Goods Sold DR.

C.The Other Accounts DR column is used for purchases on account of items other than merchandise inventory and office supplies.

D.For a perpetual inventory system, a column titled Purchases DR is needed.

Answer 1

16 What amount of bad debts expense will be reported on the income statement?

ANswer is

Bad debt Expense $22000

15000+7000

Question No 19

Answer is False

Ending balance of the account Should have a balance of $2,500.

An invoice is also known as a bill

Answer is False

A bill is "an amount of money owed for goods supplied or services rendered

While an invoice is "a list of goods sent or services provided, with a statement of the sum due for these.

30

A cash equivalent is a highly liquid investment that can be converted into cash in three years or less

Answer is False

Cash equivalents are investments that can readily be converted into cash. Usually with a maximum investment duration of three months or less

32. Which of the following is true of a purchases journal?

D.For a perpetual inventory system, a column titled Purchases DR is needed.