1. At the end of the day, the cash register tape shows $993 in cash sales but the count of cash in the register is $1,042. The proper entry to account for this excess includes a:
Debit to Cash Over and Short for $49.
Credit to Cash Over and Short for $49.
Credit to Cash for $49.
Debit to Petty Cash for $49.
Debit to Cash for $49.
2. A company that uses the net method of recording invoices made a purchase of $700 with terms of 2/10, n/30. The entry to record the purchase would include:
A credit to Cash for $686.
A credit to Discounts Lost for $14.
A debit to Merchandise Inventory for $686.
A debit to Discounts Lost for $14.
A debit to Cash for $686.
3. If a check correctly written and paid by the bank for $493 is incorrectly recorded in the company’s books for $439, how should this error be treated on the bank reconciliation?
Subtract $54 from the bank’s balance and add $45 to the book’s balance.
Add $54 to the book balance.
Add $54 to the bank’s balance.
Subtract $54 from the bank’s balance.
Subtract $54 from the book balance.
4. At the end of the day, the cash register’s record shows $1,252, but the count of cash in the cash register is $1,246. The correct entry to record the cash sales is
Debit Cash $1,252; credit Sales $1,246, credit Cash Over and Short $6.
Debit Cash Over and Short $6, credit Sales $6.
Debit Cash $1,246; debit Cash Over and Short $6; credit Sales $1,252.
Debit Cash $1,246; Credit Sales $1,246.
Debit Cash $1,252; credit Sales $1,252.
5. The following information is available for Johnson Manufacturing Company at June 30:
Cash in bank account $ 8,255
Inventory of postage stamps92
Money market fund balance 14,200
Petty cash balance 530
NSF checks from customers returned by bank1,047
Postdated checks received from customers 841
Money orders 2,057
A nine-month certificate of deposit maturing on
December 31 of current year 9,800
Based on this information, Johnson Manufacturing Company should report Cash and Cash Equivalents on June 30 of:
$20,642
$22,985
$24,124
$24,032
$25,042
6. The amount due on the maturity date of a $6,000, 60-day 8%, note receivable is (Use 360 days a year. Do not round intermediate calculations):
$6,480.
$6,000.
$5,920.
$5,520.
$6,080.
7. Teller purchased merchandise from TechCom on October 17 of the current year and TechCom accepted Teller’s $9,600, 90-day, 7% note. What entry should TechCom make on December 31, to record the accrued interest on the note? (Use 360 days a year. Do not round intermediate calculations.)
Debit Cash $28; credit Notes Receivable $28.
Debit Cash $168; credit Interest Revenue $140; credit Interest Receivable $28.
Debit Cash $140; credit Notes Receivable $140.
Debit Interest Receivable $140; credit Interest Revenue $140.
Debit Interest Receivable $28; credit Interest Revenue $28.
8. A company used the percent of sales method to determine its bad debts expense. At the end of the current year, the company’s unadjusted trial balance reported the following selected amounts:
Accounts receivable $ 443,000 Debit
Allowance for Doubtful Accounts 1,330 Debit
Net Sales 2,180,000 Credit
All sales are made on credit. Based on past experience, the company estimates 3.0% its outstanding receivables are uncollectible. What adjusting entry should the company make at the end of the current year to record its estimated bad debts expense?
Debit Bad Debts Expense $13,290; credit Allowance for Doubtful Accounts $13,290.
Debit Bad Debts Expense $66,730; credit Allowance for Doubtful Accounts $66,730.
Debit Bad Debts Expense $14,620; credit Allowance for Doubtful Accounts $14,620.
Debit Bad Debts Expense $65,400; credit Allowance for Doubtful Accounts $65,400.
Debit Bad Debts Expense $64,070; credit Allowance for Doubtful Accounts $64,070.
9. Hankco accepts all major bank credit cards, including Omni Bank’s, which assesses a 4% charge on sales for using its card. On June 28, Hankco had $3,000 in Omni Card credit sales. What entry should Hankco make on June 28 to record the deposit?
Debit Accounts Receivable $2,880; debit Credit Card Expense $120; credit Sales $3,000.
Debit Cash $2,880; debit Credit Card Expense $120; credit Sales $3,000.
Debit Cash $3,120; credit Credit Card Expense $120; credit Sales $3,000.
Debit Accounts Receivable $3,000; credit Sales $3,000.
Debit Cash $3,000; credit Sales $3,000.
10. A company uses the percent of sales method to determine its bad debts expense. At the end of the current year, the company’s unadjusted trial balance reported the following selected amounts:
Accounts receivable$ 360,000 debit
Allowance for uncollectible accounts550 credit
Net sales805,000 credit
All sales are made on credit. Based on past experience, the company estimates 0.5% of credit sales to be uncollectible. What adjusting entry should the company make at the end of the current year to record its estimated bad debts expense?
Debit Bad Debts Expense $3,475; credit Allowance for Doubtful Accounts $3,475.
Debit Bad Debts Expense $1,800; credit Allowance for Doubtful Accounts $1,800.
Debit Bad Debts Expense $2,350; credit Allowance for Doubtful Accounts $2,350.
Debit Bad Debts Expense $4,575; credit Allowance for Doubtful Accounts $4,575.
Debit Bad Debts Expense $4,025; credit Allowance for Doubtful Accounts $4,025.
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