1.

The following accounts were extracted from Point Company’s unadjusted trial balance at Dec 31,2010:
Debit Credit
Accounts receivable 1,000,000
Allowance for doubtful accounts 8,000
Net credit sales 4,000,000
Point estimates that 3% of the gross accounts receivable will become uncollectible. After adjustment at December 31,2010, the
allowance for doubtful accounts should have a credit balance of 30,000

2. At the end of its first year of operations, December 31,2010, Solid Company had accounts receivable of 500,000, which were net of the related
allowance for doubtful accounts. During 2010, Solid recorded charges to bad debt expense of 80,000 and wrote off uncollectible accounts
receivable of 20,000. How much should Solid Company report in its December 31,2010 balance sheet as accounts receivable before the allowance
for doubtful accounts? c. 560,000

3. On June 1,2010, Thomas Corp sold merchandise with a list price of 300,000 to Peter Company on account. Peter was given the following trade
discounts of 30% and 20%. Credit terms were 2/15, n/40 and the sale was made F.O.B. point of destination. On June 10,2010, when the
merchandise were delivered, Peter Company paid 5,000 of delivery costs for Thomas as an accommodation. What amount should Peter Company
remit to Thomas Company as full payment on June 14,2010? d. 159,640

4. Accounting for the interest in a non interest bearing note receivable is an example of what aspect of accounting theory?
a. Matching
b. Verifiability
c. Substance over form
d. Accounting entity

5. The following information relates to accounts receivable of Jam Company for the year 2011:
Accounts receivable, 1/1 1,300,000
Credit Sales 5,500,000
Sales Return 150,000
Accounts written off 100,000
Collections from customers 5,000,000
Estimated future sales return at 12/31 50,000
Estimated uncollectible accounts per aging at 12/31 250,000
What amount should Jam report as net realizable value of accounts receivable at Dec. 31, 2011? b. 1, 250,000

6. Which of the following transactions is not a common source of receivables?

a. Sales of merchandise
b. Amount lent to others
c. Performance of services
d. Casualty damage, not covered by insurance

7. Credit balances in accounts receivable arising from customer’s advances should be classified as
a. Current liabilities
b. Part of accounts payable
c. Long term liabilities
d. Deduction from accounts receivable

8. Receivable balances should be valued at

a. Face amount
b. Face amount minus allowance for doubtful accounts
c. Face amount minus allowance for doubtful accounts and for any anticipated adjustments which in the normal course of events
will reduce the amount of receivable to estimated realizable value
d. Maturity value

11. The total amount of receivables of BOGAY reveals the following:

Accounts receivable 600,000
Customer’s credit balances (50,000)
Installment sales 100,000
Advances to trade suppliers 40,000
 Trade discounts (10,000)
Stock subscription receivable 200,000
How much is the amount of nontrade receivables? c. 240,000

12. The following data are available on Dec. 31, 2010 for OKS Lang Company:
Credit sales 6,500,000 Accounts receivable 1,640,000
Allow. For bad debts –beg. 88,000 Accounts written off 92,000
Recovery of accounts previously written of 16,000
What is the amount of bad debt expense if based on aging, 60% of the total A/R is 96% collectible while the remaining 40% is 80%
collectible c. 158,560

13. All of Cleeneth’s sales are on a credit basis. The following information is available for 2010:
Allowance for doubtful accounts, 1/1/2010 18,000
Sales 950,000
Sales returns 80,000
Accounts written off as uncollectible, 11/30/2010 20,000
Cleeneth provides for doubtful accounts expense at the rate of 3% of net sales. At November 3, 2010, what is the entry to recognize
accounts written off?
a. Bad debt expense 20,000
Accounts receivable 20,000
b. Bad debt expense 20,000
Allow. For B/D 20,000
c. Allowance for doubtful accounts 20,000
Accounts receivable 20,000
d. Allowance for bad debts 20,000
Bad Debt expense 20,000
14. The following data are available on Dec. 31, 2010 for OKS Lang Company:
Credit sales 6,500,000 Accounts receivable 1,640,000
Allow. For bad debts –beg. 88,000 Accounts written off 92,000
Recovery of accounts previously written of 16,000. The company estimates that 9% of Accounts receivable is uncollectible. Under
the direct write off method, the amount of bad debt expense is
a. 147,600
b. 135,600
c. 92,000
d.88,000

14. Trade receivables are classified as current assets if they are reasonably expected to be collected
a. within one year.
b. Within the normal operating cycle.
c. Within one year or within the operating cycle, whichever is shorter.
d. Within one year or within the operating cycle, whichever is longer.

15. Accounting for the interest in a non interest bearing note receivable is an example of what aspect of accounting theory?
a. Matching b. Verifiability
c. Substance over form d. Accounting entity

16. A company shows cash balance of P175,000 on its bank statement dated June 30. As of June 30, there are 55,000 of
outstanding checks and P37,500 of deposits in transit.
What is the correct cash balance on the company books as of June 30? d. 157,500

17. The following information pertains to Layson Company on December 31,2015

Cash balance 258,500
Cash balance per bank statement 270,500
Checks outstanding 35,000
Bank service charge shown on December bank statement 1,000
Error made by Layson Company in recording a check that
Cleared the bank in Dec ( check was drawn in
Dec for 14,500 but recroded at P18,500) 4,000
Deposit in transit 26,000
The correct cash balance on December 31,2015 is