What is the cash realizable value of accounts receivable?
Explanation
This question tests the definition of cash (net) realizable value, a key concept in valuing accounts receivable.
Other questions
Which of the following are the three frequently used classifications of receivables?
Under the direct write-off method, when does a company charge a loss to Bad Debt Expense?
What is a primary disadvantage of the direct write-off method for uncollectible accounts?
Which of the following is an essential feature of the allowance method for uncollectible accounts?
What is the effect of writing off a specific uncollectible account under the allowance method?
When a company recovers an account that was previously written off under the allowance method, what is the first journal entry it should make?
Gonzalez Company uses the percentage-of-sales basis and concludes that 1 percent of net credit sales will become uncollectible. If net credit sales are $800,000, and the Allowance for Doubtful Accounts has a credit balance of $1,723, what is the Bad Debt Expense for the year?
The percentage-of-receivables basis of estimating uncollectible accounts emphasizes which of the following?
An aging schedule is prepared for Dart Company, and it is estimated that total uncollectible accounts will be $2,228. If the Allowance for Doubtful Accounts has a credit balance of $528 before adjustment, the adjusting entry for bad debts will include a:
A promissory note is best defined as:
In the context of a promissory note, who is the maker and who is the payee?
What is the maturity date of a 60-day note dated July 17?
When computing interest on a note receivable, the time factor for a note stated in months should be expressed as:
If a company accepts a note receivable to settle an open account, what is the initial journal entry?
What does it mean for a note to be 'honored'?
If a company prepares financial statements before a note receivable has matured, what adjusting entry must be made for an interest-bearing note?
When a note receivable is dishonored and the payee expects eventual collection, what account is typically debited?
Hendredon Furniture factors $600,000 of receivables to Federal Factors. Federal Factors assesses a service charge of 2 percent of the amount of receivables sold. What is the journal entry for Hendredon?
What is the primary formula for the accounts receivable turnover ratio?
If a company's accounts receivable turnover is 7.7 times, what is its average collection period in days?
A company sells merchandise for $1,000 and accepts the customer's national credit card. The credit card company charges a 3 percent service fee. The entry to record this transaction would include a:
If a note is stated in terms of months from the issue date, how is its maturity date determined?
What is the interest on a $1,000, 9 percent, 6-month note?
If a company has a significant amount of receivables from its own employees, where should these be reported on the balance sheet?
If an allowance account has a debit balance of $5,000 before adjustment, and an aging of receivables indicates that a balance of $60,000 is required, what is the amount of Bad Debt Expense to be recorded?
When is it appropriate for a company to use a promissory note for a transaction?
Which basis for estimating uncollectible accounts produces a better matching of expenses with revenues?
A company sells its accounts receivable to a finance company or bank. This process is known as:
JCPenney charges 1.5 percent interest per month on a $300 balance. What is the adjusting entry to record this interest?
On January 1, Wolder Co. lends Higley Co. $10,000, accepting a five-month, 9 percent interest note. What is the maturity value of the note?
If a company has an accounts receivable turnover of 10, what does this indicate?
In the aging schedule for Dart Company shown in Illustration 9-8, why does the estimated percentage uncollectible increase as the number of days past due increases?
Which of the following describes a promissory note issued to settle an existing account receivable?
If a company uses the allowance method, its balance sheet will report accounts receivable at:
What is the maturity value of a $730, 120-day, 12 percent note?
The adjusting entry for the percentage-of-sales basis for uncollectibles includes a:
In the context of the Accounts Receivable Turnover ratio, what are 'average net accounts receivable'?
A company sells a note receivable before its maturity date. This action is a form of:
What is the primary reason a retailer would accept a national credit card like Visa or MasterCard, despite the service fee?
If a company has an average collection period of 47 days, what does this number signify?
What type of account is Allowance for Doubtful Accounts?
In the Hampson Furniture example on page 410, Accounts Receivable is $200,000 and the Allowance for Doubtful Accounts is $12,000. What is the cash realizable value of the receivables?
If a company has a note receivable, how should it be valued for reporting on the balance sheet?
What is the maturity date of a three-month note dated May 1?
In the DO IT! 1 exercise on page 408, Wilton sold merchandise to Bates for $50,000, terms 3/15. Bates returned merchandise worth $2,000. If Bates pays the balance within the discount period, what is the amount of the sales discount?
What is the primary reason that a company's accounts receivable turnover ratio would be important to an investor?
If a company does not make an adjusting entry for accrued interest on a note receivable, what is the effect on the financial statements?
Which of these is NOT a party involved when a national credit card is used in a retail sale?
If a company's average collection period is significantly longer than its credit term period, what might this indicate?