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Unformatted text preview: CHAPTER 7 CASH AND RECEIVABLES TRUE-FALSE —Conceptual Answer No. Description T 1. Items considered cash. F 2. Items considered cash. F 3. Items considered cash. F 4. Cash equivalents definition. F 5. Bank overdrafts. T 6. Cash equivalents. F 7. Classification of receivables. F 8. Items considered trade receivables. T 9. Trade discount uses. T 10. Sales discounts. T 11. Valuation of receivables. F 12. Percentage-of-receivables approach. F 13. Percentage-of-sales method. T 14. Reporting notes receivable. F 15. Stated interest rate vs. effective rate. F 16. Classification of notes receivable. T 17. Recourse liability. F 18. Buying receivables with recourse. T 19. Selling receivables with recourse. F 20. Computing receivables turnover. MULTIPLE CHOICE —Conceptual Answer No. Description d 21. Identification of cash items. b 22. Identification of cash items. d 23. Classification of travel advance. d P 24. Items included as cash. d S 25. Cash equivalent definition. d 26. Classification of bank overdraft. d 27. Classification of compensating balances. d 28. Definition of trade receivables. d 29. Identification of trade receivables. c S 30. Presentation of nontrade receivables. d S 31. Cash discount definition. d P 32. Trade discount uses. a 33. Classification of sales discounts. c 34. Valuation of short-term receivables. d 35. Bad debt provision and the matching concept. a 36. Bad debts as a percentage of sales. 7 - 2 Test Bank for Intermediate Accounting, Twelfth Edition MULTIPLE CHOICE —Conceptual (cont.) Answer No. Description b 37. Bad debts as a percentage of sales. a 38. Bad debts as a percentage of receivables. d 39. Financial statement effect of a note recorded incorrectly. c 40. Factoring accounts receivable without recourse. c S 41. Classification of accounts and notes receivable. a S 42. Transfer of receivables with recourse. a P 43. Accounts receivable turnover ratio. d 44. Accounts receivable turnover ratio. c *45. Entry to replenish Petty Cash. c *46. Purpose of Cash Over & Short account. b *47. Classification of bank service charges. c *48. Treatment of bank credits on bank reconciliation. P These questions also appear in the Problem-Solving Survival Guide. S These questions also appear in the Study Guide. * This topic is dealt with in an Appendix to the chapter. MULTIPLE CHOICE —Computational Answer No. Description d 49. Calculate effective interest on loan with required compensatory balance. b 50. Reporting cash. c 51. Cash and cash equivalents. b 52. Reporting cash. c 53. Cash and cash equivalents. c 54. Determine effective annual interest rate of sales discount. b 55. Calculate balance of accounts receivable. b 56. Calculate net realizable value of accounts receivable....
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This note was uploaded on 06/03/2010 for the course ACC 51 taught by Professor Botsford during the Spring '08 term at DeAnza College.
- Spring '08