15SP 2021 DLONL Study Guide for Final on Chapters 8.docx

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15SP 2021 DLONL Study Guide with Sample Questions for Final on Chapters 8-15 Apply the direct write-off method for uncollectibles 8.2-5 TRUE or FALSE 1) The direct write-off method for uncollectible accounts violates the matching principle. SHORT ANSWER | FILL-IN-THE-BLANK 2) The following information is from the records of Armadillo Camera Shop: Accounts receivable, December 31, 2014 $80,000 (debit) Net credit sales for 2014 165,000 Accounts written off as uncollectible during 2014 15,000 Cash sales during 2014 40,000 The company uses the direct write-off method for bad debts. What is the amount of bad debts  expense? 3) On January 1, Davidson Services has the following balances:   Davidson has the following transactions during January: Credit sales of $100,000, collections of  credit sales of $85,000, and write-offs of $15,000. Davidson uses the direct write-off method. At  the end of January, the balance in Accounts Receivable is ________. Apply the allowance method for uncollectibles and estimate bad debts expense based on the percent-of-sales, percent-of-r 8.3-2 TRUE or FALSE 4) The allowance method violates the matching principle. 5) A method of accounting for uncollectible receivables in which the company estimates bad  debts expense instead of waiting to see which customers the company will not collect from is  known as the allowance method. SHORT ANSWER | FILL-IN-THE-BLANK 6) GAAP requires most companies to use the ________.
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Account for natural resources 9.4-6 TRUE or FALSE 7) A natural resource is an asset that comes from the earth and is consumed. 8) The process by which businesses spread the allocation of a natural resource's cost over its  usage is known as depreciation. SHORT ANSWER | FILL-IN-THE-BLANK 9) A coal mine cost $1,000,000 and is estimated to hold 50,000 tons of coal. There is no residual  value. 6,000 tons are extracted and sold during the first year of operations. Calculate depletion  expense for the first year. Journalize entries for the disposal of plant assets 9.3-8 10) An asset was purchased for $24,000. The asset's estimated useful life was 5 years, and its  residual value was $4,000. The straight-line method of depreciation was used. Calculate the gain  or loss on sale if the asset is sold for $18,000 at the end of the first year. 11) The gain or loss on the sale of a plant asset is determined by comparing ________. Measure the cost of a plant asset 9.1-14 TRUE or FALSE 12) The cost principle requires a business to record the assets acquired or services received at  their actual cost.
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