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CHAPTER 9 Receivables EYE OPENERS 1.Receivables be normally classified as (1) accounts receivable, (2) notes receivable, or (3) other receivables. 2.Transactions in which merchandise is sold or services are provided on credit generate accounts receivable. 3.a. sure Assets b.Investments 4.Examples of other receivables include interest receivable, taxes receivable, and receivables from officers or employees. 5.Gallatin Hardware should expenditure the direct write-off method because it is a small pipeline that has a relatively small number and volume of accounts receivable and they are immaterial. 6.Contra asset, credit poise 7. The accounts receivable and allowance for doubtful accounts whitethorn be reported at a net tote up of $266,950 ($298,150 $31,200) in the Current Assets section of the balance sheet. In this case, the derive of the allowance for doubtful accounts should be shown separately in a note to the financial statements or in parentheses on the balance sheet. Alternatively, the accounts receivable may be shown at the gross measuring rod of $298,150 less the amount of the allowance for doubtful accounts of $31,200, thus giving up net accounts receivable of $266,950. 8.

(1)The percentage rate used is exuberant in relationship to the volume of accounts written off as uncollectible; hence, the balance in the allowance is excessive. (2)A strong volume of old uncollectible accounts is still being carried in the accounts receivable account. 9.An estimate based on aging of receivables provides the close accurate estimate of the current net realizable value. 10.The advantages of a claim evidenced by a note are that (1) the debt is acknowledged, (2) the payment terms are specified, (3) it is a stronger claim in the event of court action, and (4) it is usually more readily negotiable to a creditor in settlement of a debt or to a bank for cash. 11.a.Tucker Company b.Notes Receivable 12.The interest will amount to... If you penury to get a full essay, order it on our website: Orderessay

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