Accounting

2790 Words12 Pages
—Conceptual
21.Which of the following is not considered cash for financial reporting purposes?
a.Petty cash funds and change funds
b.Money orders, certified checks, and personal checks
c.Coin, currency, and available funds
d.Postdated checks and I.O.U. 's

22.Which of the following is considered cash?
a.Certificates of deposit (CDs)
b.Money market checking accounts
c.Money market savings certificates
d.Postdated checks

23.Travel advances should be reported as
a.supplies.
b.cash because they represent the equivalent of money.
c.investments.
d.none of these.

24.Which of the following items should not be included in the Cash caption on the balance sheet?
a.Coins and currency in the cash register
b.Checks from other
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a.Charging bad debts with a percentage of sales under the allowance method.
b.Charging bad debts with an amount derived from a percentage of accounts receivable under the allowance method.
c.Charging bad debts with an amount derived from aging accounts receivable under the allowance method.
d.Charging bad debts as accounts are written off as uncollectible.

36.Which of the following methods of determining annual bad debt expense best achieves the matching concept?
a.Percentage of sales
b.Percentage of ending accounts receivable
c.Percentage of average accounts receivable
d.Direct write-off

37.Which of the following is a generally accepted method of determining the amount of the adjustment to bad debt expense?
a.A percentage of sales adjusted for the balance in the allowance
b.A percentage of sales not adjusted for the balance in the allowance
c.A percentage of accounts receivable not adjusted for the balance in the allowance
d.An amount derived from aging accounts receivable and not adjusted for the balance in the allowance

38.The advantage of relating a company 's bad debt expense to its outstanding accounts receivable is that this approach
a.gives a reasonably correct statement of receivables in the balance sheet.
b.best relates bad debt expense to the period of sale.
c.is the only generally accepted method for valuing accounts receivable.
d.makes estimates of uncollectible accounts unnecessary.

39.At the beginning of 2006, Finney
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