Stretching payables refers to postponing payment of bills to their due dates or last date of discount period that is intended to shorten the cash cycle. True False
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- _______________ 5. The interest on a non-interest bearing note is equal to its discount amount._______________ 6. The practice of realizing cash from accounts receivable before its maturity date is widespread. Defalcation is one of them. True or False?38 [Question text] Which one of the following situations will decrease the cash cycle as all else held constant? Select one: A. Decreasing the inventory turnover rate B. Increasing the accounts receivable turnover rate C. Decreasing the accounts payable period D. Increasing the inventory periodTime remaining: 01 :57 :19 Accounting Several of Kimper Corporation's major customers experienced cash flow problems in 2020, mainly due to their increasing labour and production costs in 2019 and 2020. As a result, Kimper's accounts receivable turnover ratio (net sales revenue/average trade receivables [net]) decreased significantly in 2020. However, Kimper believes that its customers' cash flow problems are temporary. In estimating uncollectible accounts receivable as at December 31, 2020, Kimper decreased the estimated percentage of its outstanding accounts receivable that will become uncollectible. (A lower percentage was applied in 2020 than was applied in the previous five years.) Kimper's bad debt expense as a percentage of sales for the year ended December 31, 2020, was lower than the percentage reported in the previous five years, and no additional note disclosure regarding potentially higher risk of uncollectible accounts was reported. Based only on the information…
- [Question 6 Which one of the followingsituations will decrease the cash cycle as all elseheld constant?Select one:rateA. Decreasing the accounts payable periodB. Increasing the accounts receivable turnoverC. Increasing the inventory periodD. Decreasing the inventory turnover rate_______________ 4. When accounts receivable is factored, the accounts payable shall be credited. True or False?_______________ 5. The interest on a non-interest bearing note is equal to its discount amount._______________ 6. The practice of realizing cash from accounts receivable before its maturity date is widespread. Defalcation is one of them. True or False?30.The concept and accounting for cash discounts and trade discounts are a. always the same. b. never the same. c. tied to the timing of cash collections on the account. d. dependent on the credit terms of the entity.
- (Supplement 5A) What are the arguments for and againstreplenishing all petty cash funds at the end of eachaccounting period?27 [Question text] Which of the following statements is FALSE? Select one: A. One method used to monitor the collections of accounts receivable is the aging schedule. B. The key to maintaining control over collection of accounts receivable is that the probability of default increases with the age of the account. C. Accounts receivable is an asset that reflects sales made on credit. D. Since the 2 percent discount is so small, terms of credit such as 2/10 net 30 do not have much impact on accounts receivable management.14. Record the write-off. Choose * Account Payable * Allowance for Uncollectible Accounts * Sales Returns and Allowanced * Bad debt expense * Cash * Accounts Receivable
- Q 26 Question 26 Assuming that the Rector Company uses the Balance Sheet Approach to estimate bad debt expense. Based on aging of accounts receivable management estimates that the desired balance in the allowance for uncollectible accounts should be $18,000. The balance in the allowance for uncollectible accounts before the adjusting entry is made is $1,000 CREDIT balance. The entry to record bad debt expense would be: Select one: a. Dr. Allowance for Uncollectible Accounts 17,000 and Cr. Accounts Receivable 17,000 b. Bad Debt Expense 17,000 and Cr. Allowance for Uncollectible Accounts 17,000 c. Dr. Allowance for Uncollectible Accounts 18,000 and Cr. Accounts Receivable 18,000 d. Dr. Bad Debt Expense 18,000 and Cr. Allowance for Uncollectible Accounts 18,00016 In “Percentage of accounts receivables method”, the uncollectable accounts receivables percentage is estimated based on ____________________. a. Past experience b. None of the given options c. The impact by current conditions such as economic trends and customer difficulties. d. Both past experience and the impact by current conditions such as economic trends and customer difficultiesIdentify the term/s being asked in the following statements: part 2 4. The practice of realizing cash from accounts receivable before its maturity date is widespread. Defalcation is one of them. True or False? 5. This is the criterion to determine whether the transfer is accounted for as borrowing. 6. What account to debit if the company pays a delinquent notes receivable that was previously discounted. 7. On January 1, an entity received a one-year note receivable bearing interest at the market rate. The face value of the note receivable and the entire interest are due in one year. When the note receivable was recorded on January 1, the Interest receivable is debited. True or False? 8. A 120-day, 10% interest-bearing note receivable is sold to a bank with recourse after being held for 60 days. The proceeds are calculated using an 8% interest rate. In this situation, what happened to the notes receivable?