31) KayCo began business January 1, 2012. During 2012, sales were $650,000. The year-end accounts receivable balance was $104,000. The company estimates that 1.5% of sales will become bad debts. The financial statements for the year ended December 31, 2012 will show ________.
A) bad debts expense of $1,560 on the income statement
B) bad debts expense of $9,750 on the income statement
C) net accounts receivable of $94,250 on the income statement
D) bad debts expense of $1,560 on the balance sheet
32) KayCo began business January 1, 2012. During 2012, sales were $650,000. The year-end accounts receivable balance was $104,000. The company estimates that 10% of accounts receivable will be uncollectible. The financial statements for the year ended December 31, 2012 will show ________.
A) bad debts expense of $10,400 on the income statement
B) bad debts expense of $9,750 on the income statement
C) net accounts receivable of $94,250 on the balance sheet
D) bad debts expense of $10,400 on the balance sheet
33) Rusk, Inc. had the following balances at December 31, 2012, before recording any adjustments:
Sales$450,000
Accounts receivable$ 30,000
Allowance for uncollectible accounts$ 500a positive number
Rusk estimated that $3,000 of the receivables would be uncollectible. The financial statements for the year ended December 31, 2012 will show:
A) Bad debts expense of $2,500 on the income statement.
B) Allowance for uncollectible accounts of $(3,000) on the balance sheet.
C) Net accounts receivable of $27,000 on the balance sheet.
D) more than one of the above is correct.
34) Z Company obtained the following balances from its computerized accounting information system at the end of the year
before
adjustments:
Accounts receivable$ 50,000
Allowance for uncollectible accounts (1,000)
Net sales200,000
Bad debts expense0
The company estimates that 2% of net sales will be uncollectible. After the correct adjusting entry has been made, bad debts expense for the year will be:
A) $4,000.
B) $1,000.
C) $3,000.
D) $5,000.
35) Z Company obtained the following balances from its computerized accounting information system at the end of the year
before
adjustments:
Accounts receivable$ 50,000
Allowance for uncollectible accounts (1,000)
Net sales200,000
Bad debts expense0
The company estimates that 2% of net sales will be uncollectible. After the correct adjusting entry has been made, the allowance for uncollectible accounts will be:
A) $(1,000).
B) $(3,000).
C) $(4,000).
D) $(5,000).
36) Z Company obtained the following balances from its computerized accounting information system at the end of the year
before
adjustments:
Accounts receivable$ 50,000
Allowance for uncollectible accounts (1,000)
Net sales200,000
Bad debts expense0
The company estimates that 2% of net sales will be uncollectible. After the correct adjusting entry has been made, what is the net accounts receivable on the year-end balance sheet?
A) This is a trick question. Accounts receivable appear on the income statement, not the balance sheet.
B) $46,000
C) $45,000
D) $44,000
37) Z Company obtained the following balances from its computerized accounting information system at the end of the year
before
adjustments:
Accounts receivable$ 50,000
Allowance for uncollectible accounts 100this is a
positive
number
Net sales200,000
Bad debts expense0
The company estimates that 2% of net sales will be uncollectible. After the correct adjusting entry has been made, bad debts expense for the year will be:
A) $4,000.
B) $1,000.
C) $3,000.
D) $5,000.
38) Z Company obtained the following balances from its computerized accounting information system at the end of the year
before
adjustments:
Accounts receivable$ 50,000
Allowance for uncollectible accounts 100this is a
positive
number
Net sales200,000
Bad debts expense0
The company estimates that 2% of net sales will be uncollectible. After the correct adjusting entry has been made, the allowance for uncollectible accounts will be:
A) $(4,100).
B) $(3,900).
C) $(4,000).
D) $(1,100).
39) Z Company obtained the following balances from its computerized accounting information system at the end of the year
before
adjustments:
Accounts receivable$ 50,000
Allowance for uncollectible accounts 100this is a
positive
number
Net sales200,000
Bad debts expense0
The company estimates that 2% of net sales will be uncollectible. After the correct adjusting entry has been made, what is the net accounts receivable on the year-end balance sheet?
A) This is a trick question. Accounts receivable appear on the income statement, not the balance sheet.
B) $46,100
C) $46,000
D) $45,900
40) Y Company obtained the following balances from its computerized accounting information system at the end of the year
before
adjustments:
Accounts receivable$ 27,000
Allowance for uncollectible accounts (3,000)
Net sales100,000
Bad debts expense0
The company estimates that 20% of accounts receivable will be uncollectible. After the correct adjusting entry has been made, the allowance for uncollectible accounts will be:
A) $(2,400).
B) $(4,800).
C) $(5,400).
D) $(20,000).