8.1/ Vocab
What is the maturity value of a note?
The principal amount plus interest due
Why is the direct write-off method unacceptable under GAAP?
Violates the Matching Principle
Total interest accrued on a $7,500, 5%, 3-month note is:
$93.75
What is the Capital of Alaska?
Juneau
A record that contains the details by customer or vendor of the individual account balances would be called a:
subsidiary ledger
JJ Company has a receivable for $92 that they now deem to be uncollectible. Charlton uses the direct write-off method. Describe the journal entry
Bad Debts Exp $92
A/R $92
What is the name of the "powerhouse" of a cell? [It is known for cellular respiration (releasing energy)]
Mitochondria
_____ is the number of times per year a company sells goods and collects receivables
accounts receivable turnover ratio
What is the term when the maker of a promissory note fails to pay the note on the due date?
A dishonored note
Who was the first Native American to win an Olympic Gold Medal? He also played in the MLB, "NFL", and a lower level pro basketball league
Jim Thorpe
On December 1, 2019, Jim sold machinery to a customer for $2,000. The customer could not pay at the time of sale, but agreed to pay 9 months later, and signed a 9-month note at 12% interest. How much interest revenue was earned during the year 2020?
$160
_____ shows how frequently (in days) during the year the accounts receivable are collected
Days' Sales in Receivable
What NFL player has the most sacks of all time?
Bruce Smith
Accounts receivable has a balance of $16,000 and the Allowance for bad debts has a credit balance of $1,700. What is Net accounts receivable before and after a $60 account receivable is written off?
$14,300 before and $14,300 after
A six-month note receivable for $4,000 at 12% dated September 1, 2020, has accrued interest revenue of __________ as of December 31, 2020.
$160
Using the following accounts, what is the acid test ratio?
Cash: $60,000
S.T. Inv: $75,000
Net Current Rec: $140,000
Inv: $145,000
Total Currrent Liab: $395,000
.7
_____is the party to a credit transaction who is obligated to pay later.
Debtor
Smart Arts Year: During the year, there were credit sales of $40,000, and collections of $36,000. One account for $640 was written of. Smart Art uses the percent-of-sales method to account for Bad Debts expense, and has decided to use a factor of 2% for their year-end adjustment of Bad Debt expense. Describe the journal entry required to record expense at the end of the year
Bad Debt Expense $800
Allowance for Bad Debt $800
Carlos Car Company accepted a 4-month, 10% note for $2,400 on Oct 1st. Tell me the journal entry if it was paid at the maturity date.
Cash $2,480
Int Rec $60
Note Rec $2,400
Int Rev $20
Who was the first president to be born in the United States? HINT: English was his second language;Dutch was his first
Martin Van Buren