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Quiz - Chapter 4 - Accounts Receivable - Ia 1 - 2020 Edition
Quiz - Chapter 4 - Accounts Receivable - Ia 1 - 2020 Edition
Chapter 4
Accounts Receivable
NAME: Date:
Professor: Section: Score:
QUIZ:
1. Which of the following should be recorded in Accounts Receivable?
a. Receivables from officers representing employee loans
b. Receivables from subsidiaries
c. Dividends receivable
d. None of these
2. When the allowance method of recognizing bad debts expense is used, the entry to record the
write-off of a specific uncollectible account would decrease
a. the allowance for doubtful accounts.
b. the profit for the period.
c. the net realizable value of accounts receivable.
d. the working capital.
4. On December 27, 20x1, ABC Co. received a sale order for a credit sale of goods with selling price of
₱3,000. The goods were shipped by ABC on December 31, 20x1 and were received by the buyer on
January 2, 20x2. The related shipping costs amounted to ₱20. ABC Co. collected the receivable on
January 5, 20x2. If the term of the sale is FOB destination, freight collect, how much net cash is
collected on January 5, 20x2?
a. 3,020
b. 3,000
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c. 2,980
d. 0
5. Soap Co. has the following information on December 31, 20x1 before any year-end adjustments.
Allowance for doubtful accounts, Jan. 1 30,400
Write-offs 19,000
Recoveries 3,800
Sales (including cash sales of ₱380,000) 2,280,000
Sales returns and discounts (including ₱3,800 sales
22,800
returns on cash sales)
Accounts receivable, Dec. 31 570,000
Percentage of credit sales 3%
6. Washing Co. has the following information on December 31, 20x1 before any year-end adjustments.
Accounts receivable, Jan. 1 80,000
Net credit sales 270,000
Collections from customers (including recoveries) 140,000
Allowance for doubtful accounts, Jan. 1 10,000
Write-offs 5,000
Recoveries 1,000
Percentage of receivables 5%
7. Fabric Co. sells to wholesalers on terms of 2/15, net 30. An analysis of Fabric Co.’s trade receivable
balances on December 31, 20x1, revealed the following:
Age in days Receivable balances
0 – 15 180,000
16 – 30 108,000
31 – 60 90,000
61 – 90 72,000
91 – 120 54,000
121 – 150 36,000
Total accounts receivables 540,000
Fabric Co. uses the aging of receivables method. The estimated percentages of collectability based on
past experience are shown below:
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The allowance for doubtful accounts has a balance of ₱18,000 as of January 1, 20x1. Write-offs and
recoveries during the year amounted to ₱6,000 and ₱3,000, respectively.
Additional information:
ABC Co. uses the percentage of credit sales in determining bad debts in monthly financial reports
and the aging of receivables for its annual financial statements.
Accounts written-off during the year amounted to ₱119,700 and accounts recovered amounted to
₱28,350.
As of December 31, ABC Co. determined that ₱63,000 accounts receivable from a certain customer
included in the “61-120 days outstanding” group is 95% collectible and a ₱31,500 account included in
the “Over 120 days outstanding” group is worthless and needs to be written-off.
8. How much is the balance of the allowance for doubtful accounts on January 1, 20x1?
a. 12,600
b. 18,900
c. 19,200
d. 23,400
9. How much is the adjusted bad debt expense to be reported in the year-end financial statements?
a. 123,300
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b. 128,700
c. 143,300
d. 132,300
10. ABC Co. has the following information before any year-end adjustment.
Accounts receivable, Dec. 31 600,000
Allowance for doubtful accounts, Jan. 1 18,000 (Dr.)
Percentage of receivables 2%
Write-offs and recoveries during the year amounted to ₱22,800 and ₱3,000, respectively. How much is
the bad debts expense for the year?
a. 13,800
b. 26,800
c. 49,800
d. 52,800
“The heart of the discerning acquires knowledge, for the ears of the wise seek it out.”
(Proverbs 18:15)
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