Exam 2 study guide

Exam 2 study guide - Chpt. 7 -Petty cash funds and change...

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Chpt. 7 - currency, and available funds -Bank overdrafts, if material, should be reported as a current liability -Charging bad debts as accounts are written off as uncollectible does not properly match expense and  revenue -The factor without recourse assumes the risk of collectibility and absorbs any credit losses in  collecting the receivables -required if the transfer of receivables with recourse is to be accounted for as a sale: -The transferor surrenders control of the future economic benefits of the receivables -The transferors’ obligation under the recourse provisions can be reasonably estimated -The transferee cannot require the transferor to repurchase the receivables -A Cash Over and Short account is debited when the petty cash fund proves out short -Under the allowance method of recognizing uncollectible accounts, the entry to write off an  uncollectible account has no effect on net income - money market funds are classified as temporary investments -The minimum cash amounts that banks often require customers to whom they lend money to maintain in checking accounts is called Compensating balances -treasury bills are cash equivalents -In the gross method of recording cash discounts, sales discounts are Recorded when
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Exam 2 study guide - Chpt. 7 -Petty cash funds and change...

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