Question

54. In a bank reconciliation, bank service charges will be :

Select one:

a. added to the bank balance

b. deducted from the bank balance

c. added to the book balance

d. deducted from the book balance

55. Net accounts receivable is calculated as:

Select one:

a. sales less sales returns and allowances

b. accounts receivable plus allowance for uncollectible accounts

c. accounts receivable less allowance for uncollectible accounts

d. accounts receivable less uncollectible-account expense

56. Under the allowance method, the entry to write off an uncollectible account of $500 includes:

Select one:

a. a debit to accounts receivable for $500

b. a debit to allowance for uncollelctible accounts for $500

c. a credit to uncollectible-account expense for $500

d. a credit to allowance for uncollectible accounts for $500

Answer 1

54. d. deducted from the book balance

SINCE THE SERVICE CHARGE HAS ALREADY EEN DEDUCTED FROM BANK BALANCE, IT NEEDS TO BE ADJUSTED FROM BOOK ALANCE BY REDUCING THE SERVICE CHARGES.

55. c. accounts receivable less allowance for uncollectible accounts

NET ACCOUNTS RECEIVALE = ACCOUNTS RECEIVABLE - ALLOWANCE FOR UNCOLLECTIBLE ACCOUNT

56. b. a debit to allowance for uncollelctible accounts for $500

ENTRY

ALLOWANCE FOR UNCOLLECTIBLE ACCOUNT DR $500

ACCOUNTS RECEIVABLE CR $500