1. 2. 3. Carroll Company receives a postdated check (dated the first day of the following month) from Regis Enterprises in payment of its account. Carroll agrees to deposit the check on the date of the check. How should Carroll treat the receipt of the postdated check? a. b. C. d. Maintain the Regis account as an account receivable and deposit the Regis check as agreed Write off the Regis account as a bad debt Debit Cash and credit the Regis account receivable on the date the check is received None of the above answers is correct. Lockboxes are pointed out in the text as a good method of internal control over cash. A major advantage to a lockbox account is a. b. C. d. the company that sets up such an account can visit one place to gather check payments from customers. the company that sets up such an account avoids mailings of payments that are addressed incorrectly. this type of account accelerates the availability of collected cash. company CEOs can use the lockbox payments for travel advances. If companies choose the fair value option as the basis of measurement for financial instruments, which of the following is correct? a. b. C. A company may change its decision as regards the fair value option for a financial instrument, but only after the fair value option has been in effect for more than one year. The unrealized holding gain/loss resulting from the fair value of the instrument's valuation is recorded as part of Other Comprehensive Income and is not shown on the company's income statement. The company may defer the decision to treat a financial instrument under the fair value option for no more than one month from the date of acquisition of the instrument. The unrealized holding gain/loss resulting from the fair value of the instrument's valuation is recorded as part of net income in the year of instrument valuation. How do companies report a long-term note receivable? At the present value of the cash expected to be collected At the future value of the cash expected to be collected a. b. C. At historic cost d. At current cost