Reference no: EM132793288

Problem 1: The adjusting entry to record an increase in Allowance for Bad Debts involves

a. debiting Accounts Receivable and crediting Bad Debt Expense.
b. debiting Bad Debt Expense and crediting Allowance for Bad Debts.
c. debiting Allowance for Bad Debts and crediting Bad Debt Expense.
d. debiting Allowance for Bad Debts and crediting Accounts Receivable.

Problem 2: Under the periodic inventory system, the merchandise inventory and the cost of goods sold for the current periods are determined

a. on a daily basis.
b. on a quarterly basis.
c. when a physical inventory is taken.
d. once a year.

Problem 3: An error in the reported inventory will cause errors in all of the following EXCEPT

a. the statement of owner's equity.
b. the following year's financial statements.
c. the cash account.
d. the balance sheet.