Reference no: EM133133860
Questions -
Q1. On April 2, Granger Sales decides to establish a $370 petty cash fund to relieve the burden on Accounting.
a. Journalize the establishment of the fund. If an amount box does not require an entry, leave it blank.
b. On April 10, the petty cash fund has receipts for mail and postage of $66, contributions and donations of $40, meals and entertainment of $100, and $161 in cash. Journalize the replenishment of the fund. Record any missing funds in the cash short and over account. If an amount box does not require an entry, leave it blank.
c. On April 11, Granger Sales decides to increase petty cash to $550. Journalize this event. If an amount box does not require an entry, leave it blank.
Q2. At the end of the current year, Accounts Receivable has a balance of $187,000; Allowance for Doubtful Accounts has a debit balance of $4,132; and sales for the year total $1,107,000. Bad debt expense is estimated at 1/2 of 1% of sales.
a. Determine the amount of the adjusting entry for bad debt expense.
b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense.
c. Determine the net realizable value of accounts receivable.
Q3. The actual cash received during the week ended June 7 for cash sales was $18,897, and the amount indicated by the cash register total was $18,844. Journalize the entry to record the cash receipts and cash sales. If an amount box does not require an entry, leave it blank.
Q4. A $77 petty cash fund has cash of $20 and receipts of $45. The journal entry to replenish the account would include a
a. debit to Cash Short and Over for $12.
b. credit to Cash for $77.
c. credit to Petty Cash for $45.
d. debit to Cash for $20.
Q5. Based upon the following data, estimate the cost of ending inventory using the gross profit method.
Sales $733,000
Estimated gross profit rate 34%
Beginning inventory $61,000
Purchases (net) 640,500
Merchandise available for sale $701,500
Q6. The following selected transactions relate to cash collections for a firm that maintains a $100 change fund at all times. Present entries to record the transactions for each of the two days of cash receipts from sales.
a. Actual cash in cash register, $5,305; cash receipts per cash register tally, $5,307.
b. Actual cash in cash register, $4,100; cash receipts per cash register tally, $3,959.
If an amount box does not require an entry, leave it blank.
Q7. At the end of the current year, Accounts Receivable has a balance of $924,700; Allowance for Doubtful Accounts has a credit balance of $7,696; and sales for the year total $2,974,000. Bad debt expense is estimated at 1/2 of 1% of net sales.
a. Determine the amount of the adjusting entry for bad debt expense.
b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense.
c. Determine the net realizable value of accounts receivable.
Q8. On October 1, Black Company receives a 6% interest-bearing note from Reese Company to settle a $22,600 account receivable. The note is due in six months. At December 31, Black should record interest revenue of
a. $336
b. $346
c. $339
d. $349
Q9. An aging of a company's accounts receivable indicates the estimate of uncollectible receivables totals $5,072. If Allowance for Doubtful Accounts has a $1,297 credit balance, the adjustment to record the bad debt expense for the period will require a
a. credit to Allowance for Doubtful Accounts for $5,072.
b. debit to Bad Debt Expense for $3,775.
c. debit to Bad Debt Expense for $1,297.
d. debit to Bad Debt Expense for $5,072.
Q10. Journalize the following transactions using the allowance method of accounting for uncollectible receivables.
April 1 Sold merchandise on account to Jim Dobbs, $8,100. The cost of the merchandise is $7,400. If an amount box does not require an entry, leave it blank.
June 10 Received payment for one-third of the receivable from Jim Dobbs and wrote off the remainder. If an amount box does not require an entry, leave it blank.
Oct. 11 Reinstated the account of Jim Dobbs and received $5,400 cash in full payment. If an amount box does not require an entry, leave it blank.