21) Current liabilities fall into two categories, which are referred to as:A) contra liabilities and contingent liabilities B) contingent liabilities and liabilities of a known amountC) liabilities of a known amount and liabilities whose amount must be estimatedD) liabilities of a known amount and contingent liabilities22) Net accounts receivable is calculated as:A) sales less sales returns and allowancesB) accounts receivable less bad debt expenseC) accounts receivable less allowance for uncollectible accountsD) accounts receivable plus allowance for uncollectible accounts23) Which of the following accounts is a contra-account to Accounts Receivable?A) Sales DiscountsB) Sales Returns and AllowancesC) Allowance for Uncollectible AccountsD) Bad Debt Expense24) Under the allowance method for estimating uncollectible accounts, the entry to write off an account:A) reduces total assetsB) reduces net incomeC) has no effect on total assetsD) increases net income25) Under the allowance method for estimating uncollectible accounts, the entry to record the estimated bad debts:A) increases total assetsB) reduces net incomeC) has no effect on total assetsD) has no effect on net income26) Under the allowance method, the entry to reinstate an account previously written off:A) increases total assetsB) increases net incomeC) decreases net incomeD) has no effect on net income27) Managers estimate bad debt expense based on:A) the cost constraintB) historical-cost assumptionC) revenue recognition principleD) their professional judgment28) After a customer's account has been written off under the allowance method, the customer sends the company the amount owed. Before the receipt of cash can be recorded, the company must first:A) debit Allowance for Uncollectible AccountsB) credit Bad Debt ExpenseC) debit Accounts ReceivableD) credit Accounts Receivable29) Under the allowance method, the entry to write off a $1,425 uncollectible account includes:A) a debit to Accounts Receivable for $1,425B) a credit to Bad Debt Expense for $1,425C) a credit to Allowance for Uncollectible Accounts for $1,425D) a debit to Allowance for Uncollectible Accounts for $1,42530) Under the aging-of-accounts-receivable method:A) the balance in accounts receivable prior to adjustment must be consideredB) the balance in Allowance for Uncollectible Accounts prior to adjustment is ignoredC) the balance in Allowance for Uncollectible Accounts prior to adjustment must be consideredD) the balance in Bad Debt Expense prior to adjustment must be considered