Test 1

1 D 6 B
2 A 7 B
3 A 8 B
4 A 9 D
5 B 10 D

Test 2
1
Accounts Receivable Balance 200,000.00
Allowance for bad debt balance (10,000.00)
Acconts deemed uncollectible (14,800.00)
Net Accounts Receivable 175,200.00

2
Required allowance 2,600
Before adjustment balance of allowance for
doubful accounts (2,300-2000) 300
2,900.00
Doubful accounts expense to be recorded

3
Present value of notes (240k x .75) 180,000.00
Interest income for 2017 (180k × 10%) 18,000.00
Carrying amount of notes as of Jan 2018 198,000.00
Interest income 2018 (198k ×10%) 19,800.00

4
Allowance for doubtful accounts, beg 20,500.00
Accounts written off (17,500.00)
Doubtful accounts expense for the year 19,500.00
Allowance for doubful accounts, ending 22,500.00