8 - 1 A receivable that is evidenced by a formal instrument and that normally requires the payment of interest is A an account receivable B a trade

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1. A receivable that is evidenced by a formal instrument and that normally requires the payment of interest is: A. an account receivable. B. a trade receivable. C. a note receivable. D. a classified receivable. 2. Kersee Company on June 15 sells merchandise on account to Soo Eng Co. for $1,000, terms 2/10, n/30. On June 20 Eng Co. returns merchandise worth $300 to Kersee Company. On June 24 payment is received from Eng Co. for the balance due. What is the amount of cash received? A. $700. B. $680. C. $686. D. None of the above. 3. Accounts and notes receivable are reported in the current assets section of the balance sheet at: A. Cash (net) realizable value. B. net book value. C. lower-of-cost-or-market value. D. invoice cost. 4. Net credit sales for the month are $800,000. The accounts receivable balance is $160,000. The allowance is calculated as 7.5% of the receivables balance using the percentage of receivables basis. If the Allowance for Doubtful Accounts has a credit balance of $5,000 before adjustment, what is the balance after adjustment?
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A. $12,00 0. B.
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This note was uploaded on 02/28/2012 for the course ACCT 460 taught by Professor Charley during the Spring '12 term at Aachen University of Applied Sciences.

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8 - 1 A receivable that is evidenced by a formal instrument and that normally requires the payment of interest is A an account receivable B a trade

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