Chapter 5 (Recievables)
Chapter 6 (Inventory)
Chapter 4 (Internal Controls)
Misc 1
Misc 2
100
On April 25, Foreman Electric installs wiring in a new home for $3,500 on account. However, on April 27, Foreman's electrical work does not pass inspection. The customer complains, and Foreman reduces the invoice by $600. On April 30, the customer makes full payment of the balance. Record the transaction on April 27 if any (as Foreman Electirc).
(Debit) Sales Allowance $600
(Credit) Accounts Recievable $600
What kind of account is Sales Allowance & Sales Return?
100
At the beginning of the year, Bennett Supply has inventory of $3,500. During the year, the company purchases an additional $12,000 of inventory. An inventory count at the end of the year reveals remaining inventory of $4,000. What amount will Bennett report for cost of goods sold?
$11,500
100
What is not considered cash equivalent?
Investments that mature within three months of purchase
Money market funds
Checks received
Treasury bills
Certificates of deposit
Checks received
100
The Giles Agency offers a 12% trade discount when providing advertising services of $1,000 or more to its customers. Audrey's Antiques decides to purchase advertising services of $3,500 (not including the trade discount) on account. Record The Giles Agency's journal entry for the purchase.
(Debit) A/R $3,080
(Credit) Service Revenue $3,080
[There is no account named trade discount.]
100
When do you recognize revenue based on the revenue recognition principle?
You recognize the amount during the period you completed the sale or service.
200
On March 17, Fox Lumber sells materials to Whitney Construction for $12,000, terms 2/10, n/30. Whitney pays for the materials on March 23. What amount would Fox record as revenue on March 17?
March 17 = Revenue credited $12,000
Follow-up: What is the Net Revenue on March 23?
200
Using LIFO, what is the balance of ending inventory?
Hint?
14 units * $250 = $3500 (End Inventory)
*Can you do FIFO? Also the LIFO adjustment?
200
List as many Preventive Controls as you can within 2 minutes.
+200 for the winner
Examples:
Seperation of duties, Cameras, Physical controls, Proper authorization, Employee management, E-commerce controls
200
Which element of the fraud triangle is the most controllable?
Opportunity b/c internal controls
Follow up: What are the 3 elements of fraud?
200
(T/F) (+200/-200)
During periods of rising costs, FIFO generally results in a higher ending inventory balance.
300
At the beginning of the year, Mitchum Enterprises allows for estimated uncollectible accounts of $17,400. By the end of the year, actual bad debts total $20,000. Record the write-off to uncollectible accounts.
(Debit) AUA $20,000
(Credit) Accounts Receivable $20,000
Bad debt ≠Bad debt expense
EB of AUA? Reverse Write Off?
300
Using Weighted Avg, what is the Cost of Goods Sold? (Do not round your intermediary calculations)
$13,200/49= $269.387755102 per unit
$269.387755102*35 units=$9428.57142857
*Can you do Specific Identification?
300
How would you record purchases of supplies on a credit card from a buyer point of view and a seller point of view?
Buyer
(Debit) Supplies
(Credit) Accounts Payable
Seller
(Debit) Cash
(Credit) Sales Revenue
300
Wager (0-300)
If, at the end of the year, Allowance for Uncollectible Accounts has a credit balance before any adjusting entries, what does that tell us about last year's estimate?
Bonus points if you can explain your reasoning (+100)
300
The cost of unsold inventory at the end of the year is classified as a(n) ________ in the ________.
asset, balance sheet
400
Mercy Hospital has the following balances on December 31, 2027, before any adjustment: Accounts Receivable = $70,000; Allowance for Uncollectible Accounts = $1,400 (credit). Record the adjusting entry for AUA.
Bad Debt Expense $1,370
Allowance for Uncollectible Accounts $1,370
400
On Mar 1, KSU purchased 100 books on account from Readers Wholesale for $3,500 on 2/10, n/30. On Mar 2, KSU pays cash for freight costs of $200 on the books. On Mar 7, KSU returns 20 books to Readers due to defects. On Mar 9, KSU pays Readers Wholesale. What is the balance of that inventory using the perpetual inventory method?
$3,500+$200-$700-$60=$2,940
Capitalize all expenses related to getting the inventory (long-term assets) to the location and ready for use.
400
Investing cash flows would include which of the following (how many)?
Investing activities- transactions that involve long-term assets.
1
*Know the other business activities (3 total)
400
Bingerton Industries began the year with an inventory of $85,000. On January 5th, they purchased $310,000 worth of inventory on account. On January 10th, Inventory costing $335,000 was sold on account for $520,000. Based on the perpetual inventory system, what is the journal entry(s) on January 10th for the sale of inventory?
#1
(Debit)Accounts Receivable $520,000
(Credit) Sales Revenue $520,000
#2
(Debit) COGS $335,000
(Credit) Inventory $335,000
400
T/F For inventory that is shipped FOB shipping point, title transfers from the seller to the buyer once the seller recieves the inventory.
FOB Shipping point -> when shipped
FOB Destination -> when recieved
500
At the end of the year, Mercy Cosmetics' balance of Allowance for Uncollectible Accounts is $600 (debit) before adjustment. The balance of Accounts Receivable is $25,000. The company estimates that 12% of accounts will not be collected over the next year. What Mercy Cosmetics's bad debt expense at the end of the year?
Bad Debt Expense = $3,600
When do you record bad debt expense?
500
What is the effect on the Accounting Equation for the purchase of inventory on account? Sale of inventory on account for a profit (assuming perpetual inventory system)?
Purchase of inventory on account: Asset↑ Liability↑
Sale of inventory on account: Net Asset↑ Net Equity↑
500
What is section 404 of SOX?
Management must implement and record their internal controls & Auditors must evaluate their internal controls
(Need to know what the purpose of SOX)500
On August 1, 2025, Nees Manufacturing lends $10,000 to Roberson Supply using a 9% note due in 9 months. Nees has a December 31 year-end. April 30th, Roberson pays the full amount, including the interest. How much interest revenue is recognized in 2026?
(Debit) Cash $10,675
(Credit) Notes Receivable $10,000
(Credit) Interest Receivable $375
(Credit) Interest Revenue $300
500
What are the 4 levels of the multiple-step income statement in order? And where is advertising expense included in?
gross profit, operating income (includes advertising), income before income taxes, and net income
What about interest expense?
Which one do you use to determine future profitability?