tbch06 - CHAPTER 6 The Revenue/Receivables/Cash Cycle...

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C HAPTER 6 The Revenue/Receivables/Cash Cycle M ULTIPLE C HOICE Q UESTIONS Theory/Definitional Questions 1 Definition of the operating cycle 2 Composition of cash on the balance sheet 3 Separation of duties in controls over cash 4 Understanding the bank reconciliation 5 Understanding the bank reconciliation 6 SFAS No. 125 criteria for recognizing transfers as sales. 7 Principles of internal control 8 Operating cycle defined 9 Trade discounts 10 Using direct write-off method 11 Allowance method of accounting for bad debts 12 Allowance method--recording write-off 13 Allowance method write-off--effect on net income and accounts receivable 14 Allowance method--recording collection of account written off 15 Balance sheet method of estimating bad debts--aging of accounts receivable 16 An uncollectible receivable is paid off 17 Matching principle and the recognition of an estimated liability for warranties 18 Accounts receivable turnover 19 Number of days’ sales in accounts receivable 20 Cash classifications 21 Characteristics of cash control system 22 Journal entry to replenish petty cash 23 Purpose of petty cash system 24 Purpose of petty cash reimbursement prior to year end 25 Replenishing petty cash fund 26 Bank statement information 27 Bank statement reconciliation 28 Bank statement reconciliation 29 Bank reconciliation--items added to bank balance 183
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184 Chapter 6 The Revenue/Receivables/Cash Cycle 30 Bank reconciliation--adjustments on depositor's books 31 General assignment of accounts receivable does not reduce accounts receivable balance 32 Definition of factoring accounts receivable 33 Reporting transfer of receivables with recourse as a sale 34 APB No. 21--valuation of notes receivable exchanged for property 35 Recording notes receivable without interest 36 Definition of discounting notes receivable Computational Questions 37 Computing proceeds of discounting notes receivable 38 Computing proceeds of discounting notes receivable 39 Computation of sales discounts 40 Computation of sales discounts 41 Computation of gross sales given write-off amounts under direct write-off 42 Computation of net realizable value of accounts receivable 43 Computation of net realizable value of accounts receivable 44 Computation of allowance for doubtful accounts balance 45 Computation of doubtful accounts expense 46 Computation of doubtful accounts expense 47 Computation of doubtful accounts expense 48 Computation of doubtful accounts expense--aging method 49 Computation of net realizable value of accounts receivable using percentage of credit sales for bad debts 50 Computation of doubtful accounts expense 51 Computation of warranty expenses 52 Computation of warranty expenses 53 Computation of accounts receivable turnover 54 Computation of number of days sales in average inventories 55 Computation of year-end cash balance 56 Computation of cash amount for balance sheet 57 Computation of petty cash fund reimbursement 58 Computation of reconciled cash balance
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This note was uploaded on 11/01/2011 for the course ACC 200 taught by Professor Minliu during the Spring '11 term at Universidad Europea de Madrid.

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tbch06 - CHAPTER 6 The Revenue/Receivables/Cash Cycle...

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