AG Inc. made a $25,000 sale on account with the following terms: 1/15, n/30. If the company uses the net method to record sales made on credit, how much should be recorded as revenue?

David Company uses the gross method to record sales made on credit. On June 10, 2020, it sold goods worth $250,000 with terms 2/10, n/30 to Charles Inc. On June 19, 2020, David received payment for 1/2 of the amount due from Charles Inc. David’s fiscal year-end is on June 30, 2020. What amount will be reported in the financial statements for the accounts receivable due from Charles Inc.?

At the close of its first year of operations, December 31, 2020, Ming Company had accounts receivable of $1,620,000, after deducting the related allowance for doubtful accounts. In 2020, the company had charged to bad debt expense of $270,000 and wrote off, as uncollectible, accounts receivable of $120,000. What should the company report on its balance sheet at December 31, 2020, as accounts receivable before the allowance for doubtful accounts?

The following information is available for Murphy Company:

Allowance for doubtful accounts at December 31, 2019, $ 24,000

Credit sales during 2020 $1,200,000 Accounts receivable deemed worthless and written off during 2020 $27,000

As a result of a review and aging of accounts receivable in early January 2021, it has been determined that an allowance for doubtful accounts of $16,000 is needed at December 31, 2020. What amount should Murphy record as "bad debt expense" for the year ended December 31, 2020?

15. Smithson Corporation had a 1/1/20 balance in the Allowance for Doubtful Accounts of $30,000. During 2020, it wrote off $21,600 of accounts and collected $6,300 on accounts previously written off. The balance in Accounts Receivable was $600,000 at 1/1 and $720,000 at 12/31. At 12/31/20, Smithson estimates that 5% of accounts receivable will prove to be uncollectible. What is Bad Debt Expense for 2020?

 Assuming the market interest rate is 10% per annum, how much would Green Co. record as a note payable if the terms of the loan with a bank are that it would have to make one $120,000 payment in two years? (The present value of $1 for two periods at 10% is 0.82645).

Jones Company has notes receivable that have a fair value of $950,000 and a carrying amount of $1,250,000. Jones decides on December 31, 2020, to use the fair value option for these recently-acquired receivables. Which of the following entries will be made on December 31, 2020 to record the unrealized holding gain/loss?

a.Unrealized Holding Gain or Loss Equity 300,000

Notes Receivable 300,000

b.Unrealized Holding Gain or Loss Income 300,000

Notes Receivable 300,000

c. Notes Receivable 300,000

Unrealized Holding Gain or Loss Income 300,000

d. Notes Receivable 300,000

Unrealized Holding Gain or Loss Equity 300,000

Where should goods in transit that were recently purchased f.o.b. a destination be included on the balance sheet?

a. Accounts payable.

b. Inventory.

c. Equipment.

d. Not on the balance sheet.

If a company uses the periodic inventory system, what is the impact on net income of including goods in transit f.o.b. shipping point in purchases, but not ending inventory?

a. Overstate net income.

b. Understate net income.

c. No effect on net income.

d. Not sufficient information to determine effect on net income.

If the beginning inventory for 2020 is overstated, the effects of this error on cost of goods sold for 2020, net income for 2020, and assets at December 31, 2021, respectively, are

a. overstatement, understatement, overstatement.

b. overstatement, understatement, no effect.

c. understatement, overstatement, overstatement.

d. understatement, overstatement, no effect.

Answer rating: 100% (QA)

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