A. 52 daysSolution:The mean collection duration is computed by splitting the number of days in the year through the account receivable turnover.The average collection period = 365/7 = 52 days.Chapter 8, discovering objective 8: identify ratios to analysis a company"s receivables.
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Net credit sales are $800,000, mean net receivables complete $150,000, typical inventory totals $200,000, and also the pin money for unconvinced accounts totals $8,000. Just how much is the average collection duration (also recognized as the days in unification ratio)?A. 5.33 job B. 328.8 work C. 2.2 job D. 68.5 days
D. 68.5The accounts receivable sales is net credit sales divided by typical net account receivable.The accounts receivable turnover is net credit sales ($800,000) separated by median net account receivable ($150,000), or 5.333 times. The average collection duration is 365 separated by the account receivable turnover, i m sorry is 365/5.333 = 68.5 days.
Which among the complying with is not a method used by providers to accelerate cash receipts?A. Providing discounts for early on payment B. Accepting nationwide credit cards for customer purchase C. Selling receivables to a element D. Writing off receivables
Which that the adhering to accounts is debited when a company factors its account receivable? A. Organization Charge price B. Interest price C. Accounts Receivable D. Loss on revenue of account Receivable
At what value space accounts receivable reported on the balance sheet? Cash realizable worth Maturity value present value Fair industry value
Lansing Construction firm had the following receivables:Employee advances$ 500Notes union (i.e., promissory notes from customers in exchange for solutions performed by Lansing building Co.3,500Income counting refundable2,000Accounts receivable13,000Notes union (i.e., promissory notes acquired from creditors who purchased used tools from Lansing building Co.3,000Interest receivable200Loans to firm officers4,400Based top top this information, what is the company"s "Trade Receivables"? $13,000 $16,500 $19,500 $18,700 $15,000
Receivables are assets that must be reported in the bespeak of ______? Time Cash Equivalents Liquidity interest Rates
Which one of the complying with is part of the transaction that is recorded once an account is created off under the allowance method? A. Ns on accounts Receivable account is debited. B. Account Receivable account is debited. C. Bad Debts price account is debited. D. Allowance for skeptical Accounts is debited.
Which the the complying with is offered to compute cash realizable value of accounts receivable? A. Negative Debt expense B. Allowance for unconvinced Accounts C. No one of these D. Cash
When an uncollectible account is recovered ~ it has been created off, i beg your pardon of the complying with journal entries will certainly be tape-recorded first? A. Debit Account Receivable and also credit poor Debt cost B. Debit allowance for unconvinced Accounts and also credit account Receivable C. Debit Cash and also credit pin money for cynical Accounts D. Debit accounts Receivable and also credit allowance for cynical Accounts
A 120-day promissory keep in mind is approve on April 11. What is the note"s maturity date? A. Respectable 10 B. Respectable 9 C. August 8 D. Respectable 11
B. August 9A 120-day keep in mind (or promissory note) is early out 120 days after the day of issue. Once counting days, ignore the date the note is issued but count the day it is payment (i.e., the due date). Because the keep in mind is authorize on April 11, count 19 job in April (i.e., beginning with April 12 and also ending through April 30). Counting every one of May, June, and July produce a subtotal the 73 days through the end of November (i.e., subtotal = 19 + 31 + 30 + 31 = 111 days). Therefore count 9 days in August. The note is due august 9.
On January 1, Putnam everyone Company"s allowance for cynical Accounts had a credit balance the $21,000. During the year, it had actually net credit transaction sales the $900,000 and it had actually $20,000 the uncollectible accounts receivable the were written off. Past experience indicates that the allowance must be 6% of the balance in receivables (percentage-of-receivables basis). If the account receivable balance at December 31 is $200,000, what is the forced credit adjustment to the allowance for hesitant Accounts in ~ December 31?A. $20,000B. $19,000C. $11,000D. $12,000
C. $11,000 Solution:After the write-offs are taped (but before the year-end adjusting entry), pin money for unconvinced Accounts will have a credit balance the $1,000 ($21,000 credit beginning balance combined with a $20,000 debit because that the write-offs). Utilizing the percent of receivables basis, the balance in the allowance account demands to be a credit transaction balance the $12,000 (i.e., $200,000 x 6%). In bespeak to have an finishing balance of $12,000, a credit transaction entry of $11,000 have to be make to pin money for doubtful Accounts. Thus, the quantity of the adjusting entry should be $11,000.Chapter 8, learning objective 3: define the approaches used to account for negative debts.
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Which one of the complying with is not one of the ethics of regulating accounts receivable?A. Determining to whom to extend credit B. Speeding up cash receipts indigenous receivables once necessaryC. Cross-indexing journal-entries through the postings to the ledgerD. Developing a payment periodE. Advice the liquidity that receivables
Good ingredient Retailers welcomed $60,000 of Wells Fargo Visa credit transaction card charges for merchandise offered on July 1. Wells Fargo fees 4% because that its credit card use. What should great Stuff Retailers debit together a an outcome of this transaction?A. Cash because that $57,600 and Service Charge price for $2,400B. Account Receivable for $57,600 and also Service Charge price for $2,400C. Cash for $60,000D. Accounts Receivable because that $60,000
A. Cash for $57,600 and also Service Charge cost for $2,400Solution:The entry has a credit to Sales for $60,000, a $57,600 debit come Cash, and a debit to organization Charge expense for $2,400.Chapter 8, finding out objective 9: explain methods to accelerate the receipt the cash from receivables.
In October, Oliver agency sold merchandise on account to Mr. Reed because that $100 with terms 2/10, n/30. Oliver agency uses the portion of receivables basis for estimating uncollectible account on December 31. On may 25, Oliver company determines that it will certainly not collection the amount due native Mr. Reed. Prepare the newspaper entry to document the write-off on might 25.A. Allowance for doubtful Accounts 98 accounts Receivable 98B. Pin money for skeptical Accounts 100 poor Debts expense 100C. Pin money for doubtful Accounts 100 account Receivable 100D. Poor Debts price 100 accounts Receivable 100
MyAccountingLab with Pearson eText -- Instant access -- because that Financial Accounting9th EditionCharles T. Horngren
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