1.When an allowance method is used for accounts receivable, the write-off of a specific account has no impact on net income or total assets.

True

False

2The direct write-off approach is an unacceptable accounting practice if the level of uncollectibles is significant in amount.

True

False

3.Which of the following financial ratios is not a measure of operating profitability?

A. Net Profit on Sales Ratio.

B. Inventory Turnover Ratio.

C. Return on Assets Ratio.

D. Gross Profit Margin Ratio.

ENone of these.

4.Bell Company accrued wages of $500 of December 31. The next payday, January 5, the firm paid $2,500 in wages. The company makes reversing entries. The proper entry on January 5 includes:

A.a debit to Wage Expense of $2,500.

B. a debit to Wages Payable of $500.

C. a debit to Wage Expense of $2,000.

D. a debit to Wages Payable of $2,000.

E. None of these.

5.Financial statement ratio analysis may be undertaken to study liquidity, turnover, profitability, and other measures. What type of ratio is the quick ratio?

A. liquidity

B. turnover

C. profitability

D. other

E None of these.

6.An analysis revealed Accounts Receivable of $350,000, an Allowance for Uncollectibles based on aging of $18,000. The net realizable value of accounts receivable is:

A. $309,000.

B.$327,000.

C.$332,000.

D. $350,000.

E. None of these.