Select the alternative that best answers each question or completes each statement.

32. The receivable that is usually evidenced by a formal and legal document that describes the credit granted is known as: (The receivable that is usually evidenced by a formal instrument of credit is a(n) a. trade receivable. b. note receivable. c. accounts receivable. d. income tax receivable.

33. The balance in the Allowance for Doubtful Accounts account must be considered prior to the adjustment at the end of the period when applying which method? (The balance in Allowance for Doubtful Accounts must be carefully considered prior to the end of the year adjustment when applying which method?) a. direct write-off method b. estimate based on sales c. estimate based on an analysis of receivables d. b and c are correct [both (b) and (c)]

34. Under the direct write-off method of accounting for uncollectible accounts, Bad Debts Expense is debited a. at the end of each accounting period. b. when a credit sale is declared expired (when a credit sale is past due.) c. when a certain level of credit sales has been reached (whenever a pre-determined amount of credit sales have been made.) d. when a specific account is identified as uncollectible (when an account is determined to be uncollectible.)

35. When the allowance method is used to account for uncollectible accounts, Bad Debts Expense is debited when a. a customer's account becomes past due. b. an account becomes bad and is written off. c. a sale is completed (a sale is made.) d. when recording the adjusting entry because management estimates the amount of uncollectibles.)