comp_examb - COMPREHENSIVE EXAMINATION B PART 2 (Chapters...

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COMPREHENSIVE EXAMINATION B PART 2 (Chapters 7–9) Approximate Problem Topic Time B-I Multiple Choice—Cash and Receivables. 12 min. B-II Lower of Cost or Market. 10 min. B-III Notes Receivable. 15 min. B-IV FIFO vs. LIFO. 20 min. B-V Year-end Inventory Cutoff. 15 min. B-VI *Conventional and LIFO Retail Method. 30 min. B-VII Multiple Choice—Inventory. 10 min. 112 min. *This topic is dealt with in an Appendix to the chapter.
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Test Bank for Intermediate Accounting, Eleventh Edition Problem B-I — Multiple Choice — Cash and Receivables. Choose the best answer for each of the following questions and enter the identifying letter in the space provided. _____ 1. When should the loss on an uncollectible account receivable be recorded as an expense for accrual accounting purposes? a. When it is determined that an account cannot be collected. b. In the same period in which the sale on account occurs. c. When the balance is past due for more than 3 months. d. When a lawyer indicates that collection efforts would cost more than the account is worth. _____ 2. How should unearned discounts, finance charges, and interest included in the face amount of installment accounts receivable be presented in the balance sheet? a. As a current liability. b. As a deduction from the related installment accounts receivable. c. Within the net amount of installment accounts receivable. d. As an addition to the related installment accounts receivable. _____ 3. Oswald Company's account balances at December 31 for Accounts Receivable and the related Allowance for Doubtful Accounts are $750,000 and $20,000, respectively. From an analysis of accounts receivable, it is estimated that $42,000 of the December 31 receivables will be uncollectible. After adjustment for the above facts, the net realizable value of accounts receivable would be a. $750,000. b. $730,000. c. $688,000. d. $708,000. _____ 4. Which group of items listed below should be included in the cash account? a. Silver coins, postage stamps, demand deposits, personal checks. b. Promissory notes, demand deposits, money orders, silver coins. c. Money orders, postdated checks, personal checks, time deposits. d. Silver coins, money orders, demand deposits, personal checks. _____ 5. Which of the following methods of accounting for uncollectible accounts does not properly match costs with revenues? a. Percentage of sales b. Percentage of receivables c. Direct write-off d. Aging schedule B - 2
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Comprehensive Examination B _____ 6. Certain information relative to the 2004 operations of Ross Co. follows: Accounts receivable, January 1, 2004 $20,000 Accounts receivable collected during 2004 39,000 Cash sales during 2004 12,000 Inventory, January 1, 2004 18,000 Inventory, December 31, 2004 16,500 Purchases of inventory during 2004 33,000 Gross margin on sales 13,500 What is Ross's accounts receivable balance at December 31, 2004? a.
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This note was uploaded on 05/01/2011 for the course ACCT 3341 taught by Professor Dr.ramaswamy during the Spring '09 term at University of St. Thomas-Texas.

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comp_examb - COMPREHENSIVE EXAMINATION B PART 2 (Chapters...

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