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FINANCIAL ACCOUNTING - Quiz 5 - Chapters 7 & 8

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Question;FINANCIAL;ACCOUNTING;Quiz;5;Chapters;7 & 8;Score %;Name;Course Section;PROBLEM 1?BANK RECONCILIATION;INSTRUCTIONS: Indicate the proper place;for each of the following reconciling items by inserting the correct letter;from the bank reconciliation form below in the Answers column.;Dylan;Co., Bank Reconciliation, April 30, 20?;Cash;balance per bank statement.................. $XX Cash;balance per depositor's records........... $XX;Additions.............................................................. A Additions.............................................................. C;Deductions.......................................................... B Deductions.......................................................... D;Adjusted;balance............................................... $XX Adjusted;balance............................................... $XX;For;Scoring;ITEMS;Answers;0. Check drawn by depositor for $98 but;recorded in journal as $89...........;D;0.;1. Deposit in transit not recorded by bank, $6,668...........................................;1.;2. Customer's check returned by bank to;depositor because of insufficient funds, $204..........................................................................................................;2.;3. The bank has processed and paid a check in;the amount of $175. It has not been;recorded in the journal..............................................................;3.;4. Proceeds of bank loan omitted from;journal, $56,125................................;4.;5. Bank debit memorandum for service charges;$35....................................;5.;6. Check for $345 written by Upton Co., but;erroneously charged by bank to Dylan Co..........................................................................................................;6.;7. Checks outstanding, $11,456............................................................................;7.;8. Deposit of $7,950 recorded in journal as;$7,590.........................................;8.;9. Bank credit memorandum for note collected;by the bank, $6,150;including $150 interest......................................................................................;9.;10. Deposit of $6,900 erroneously listed on;the bank statement as $9,800...;10.;FILL-IN-THE-BLANK;1?PRINCIPLES AND TERMINOLOGY;INSTRUCTIONS: Complete each of the;following statements by writing the appropriate words in the Answers column.;For;Scoring;STATEMENTS;Answers;0. The notification that accompanies the check;and indicates the specific;invoice that is being paid is called a(n)........................................................;remittance advice;0.;1. The procedures used by a company to;safeguard its assets, process information accurately, and ensure compliance;with laws are called....;1.;2. Before a voucher is prepared for the;purchase of merchandise, the three documents to support the correctness of;the amount of the liability are the:.................................................................................................;2.;continued;For;Scoring;STATEMENTS;Answers;3. A fund established to avoid writing checks;for small amounts is called a(n)...................................................................;5.;4. A cash balance required by the bank to be;maintained by a business is called a(n)...................................................................;6.;5. Cash equivalents are considered;?equivalent? because they are highly.............................................................................................................................................................................................................;7.;6. Compensating balances should be disclosed;in the..............;8.;7. If the actual cash received from cash sales;is more than the amount;indicated by the cash register tally, the overage would be credited to an;account entitled.....................................................;9.;8;- 11... The three objectives of;internal control are to provide reasonable assurance that, assets are....................................;10.;9. business information is................................................................;11.;10. laws and regulations are...............................................................;12.;11. A debit balance in the cash short and over;account is reported on the income statement in the section entitled.......;13.;PROBLEM 2?ANALYSIS OF TRANSACTIONS;INSTRUCTIONS: In the appropriate;columns, insert the letters of the accounts to be debited and credited in;recording the selected transactions described below.;ACCOUNTS;A. Accounts Payable F. Cash Short and;Over J. Misc. Administrative Expense N. Office Supplies;B. Accounts Receivable G. Interest Expense K. Misc. Selling Expense O. Petty Cash;C. Capital Stock H. Interest Revenue L. Notes;Payable P. Purchases;D. Dividends I. Merchandise Inventory M. Notes;Receivable Q. Sales;E. Cash;For;Scoring;For;Scoring;TRANSACTIONS;Debit;Credit;0. Purchased office supplies on account.........................................................;N;0.;A;0.;1?2. Issued check for payment for merchandise;purchased on account, within the discount period...............................................................................;1.;2.;3?4. Issued check to establish petty cash fund....................................................;3.;4.;5?6. The actual cash counted and deposited was;less than the amount;recorded on the cash register receipt tape for sales for the day.............;5.;6.;7?8. Recorded entry based on bank reconciliation;for bank credit;memorandum for note collected by bank....................................................;7.;8.;9?10. Recorded entry based on the bank;reconciliation for bank debit;memorandum for customer?s check returned by bank for;insufficient funds..............................................................................................;9.;10.;11?12.. Reimbursed the petty cash fund for;disbursements made for office supplies, miscellaneous administrative expense;and miscellaneous selling expense.................................................................................................;11.;12.;FILL-IN-THE-BLANK 2?PRINCIPLES AND TERMINOLOGY;INSTRUCTIONS: Answer the following;questions or complete the statements by writing the appropriate words or;amounts in the Answers column.;For;Scoring;QUESTIONS/STATEMENTS;Answers;0. The party purchasing a company?s;receivables is called a(n)...................;factor;0.;1. Allowance for Doubtful Accounts has a;credit balance of $10,000 at the end of the year, before adjustments. Sales;for the year amounted to $1,500,000, and sales returns and allowances;amounted to $50,000. If uncollectible accounts expense is estimated at 2% of;net sales, the amount of the appropriate adjusting entry will be........................................;$;1.;2. If, instead of a percentage of net sales;the adjusting entry in Question 1;is based on an analysis of receivables that indicates doubtful accounts of;$20,500, the amount of the adjustment will be........................................;$;2.;3. Allowance for Doubtful Accounts has a;debit balance of $1,500 at the end of the year, before adjustment. If an;analysis of receivables indicates doubtful accounts of $17,000, the amount of;the appropriate adjusting entry will be........................................................................................;$;3.;4. The maturity value of a $100,000, 180-day;4% note receivable is..........;$;4.;5. In writing off an uncollectible account by;the direct write-off method, the account credited is..............................................................................................;$;5.;6. At the end of the fiscal year, after the;accounts are closed, Accounts;Receivable has a balance of $975,000, and Allowance for Doubtful;Accounts has a balance of $125,000.;What is the expected net realizable value of the receivables?...............................................................;$;6.;7. Where on the balance sheet would;receivables that are expected to be realized in cash within one year be;reported?..............................................;7.;8. Allowance for Doubtful Accounts is listed;on the appropriate financial;statement in the subsection titled....................................................................;8.;9. Notes receivable expected to be collected;in 1? years are listed on the;financial statements in the subsection titled..................................................;9.;10. If the receivable turnover is 20, how many;days are the receivables;outstanding, on the average?...........................................................................;10.;PROBLEM;3?ANALYSIS OF TRANSACTIONS AND ADJUSTMENTS;INSTRUCTIONS: In recording the selected;transactions and adjustments, indicate the titles of the general ledger;accounts to be debited and credited by inserting in the appropriate column the;letters that correspond to the account titles listed.;ACCOUNTS;A. Accounts Payable E. Interest Expense I. Misc. Administrative Expense;B. Accounts Receivable F. Interest Revenue J. Notes Payable;C. Allowance for Doubtful Accounts G. Interest Payable K. Notes Receivable;D. Cash H. Interest Receivable L. Bad Debt;Expense;For;Scoring;For;Scoring;TRANSACTIONS;Debit;Credit;0. Received the final payment on a promissory;note.....................................;D;0.;K, F;0.;1?2. Recorded;the adjusting entry for estimated uncollectible accounts at the end of the;fiscal period, based upon the allowance method............;1.;2.;3?4. Wrote;off the account of the bankrupt debtor (included in Allowance for Doubtful;Accounts provision made in Question 1?2)..........................;3.;4.;5?8. Recovered;the bad debt written off in Question 3?4..................................;5.;6.;7.;8.;9?10. Replaced;a customer?s account receivable with a note receivable........;9.;10.

 

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