Chapter7Quiz - ACCT 251 Intermediate Accounting I Chapter 7...

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ACCT 251 Intermediate Accounting I Chapter 7 Quiz Name_______ 1. The category "trade receivables" includes a. advances to officers and employees. b. income tax refunds receivable. c. claims against insurance companies for casualties sustained. d. none of these. 2. The accounting for cash discounts and trade discounts are a. the same. b. always recorded net. c. not the same. d. tied to the timing of cash collections on the account. 3. Of the approaches to record cash discounts related to accounts receivable, which is more theoretically correct? a. Net approach. b. Gross approach. c. Allowance approach. d. All three approaches are theoretically correct. 4. Why is the allowance method preferred over the direct write-off method of accounting for bad debts? a. Allowance method is used for tax purposes. b. Estimates are used. c. Determining worthless accounts under direct write-off method is difficult to do. d.
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Chapter7Quiz - ACCT 251 Intermediate Accounting I Chapter 7...

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