When using the percentage of sales method of estimating uncollectible accounts, any existing balance in the Allowance for Uncollectible Accounts account is ignored as
long as the account has a credit balance after adjustment. True False 2 points Question 2 In counting the days of interest on a note, the day the money is borrowed is
omitted, but the day it is paid back is counted. True False 2 points Question 3 Credit card companies absorb the loss from uncollectible accounts. True False 2 points
Question 4 Both a company’s credit terms and collection policies affect accounts receivable turnover. True False 2 points Question 5 Generally, the older the account
receivable, the lower the probability of collection. True False 2 points Question 6 When a company collects sales taxes from customers, the amount of taxes collected
represents a revenue. True False 2 points Question 7 When a note is dishonored, the payee should debit Accounts Receivable for the maturity value of the note. True
False 2 points Question 8 When a note is dishonored, the payee will make an entry that includes a credit to: A. Accounts Receivable. B. Cash. C. Notes
Receivable. D. Interest Payable. 2 points Question 9 Maxwell issued to Prentice Co., a $2,400, 90-day, 12 percent note for the purchase of goods. The journal entry
needed on Prentice Company’s books at the time of sale is: A. Notes Receivable 2,472 Sales 2,400 Interest Revenue 72 B. Notes Receivable 2,400
Sales 2,400 C. Notes Receivable 2,436 Sales 2,436 D. Notes Receivable 2,400 Interest Revenue 72 Sales 2,472 2 points
Question 10 In estimating uncollectible accounts for a period, the percentage of sales method is the simplest method. True False 2 points Question 11 The interest rate
on notes receivable and notes payable is generally stated in annual terms. True False 2 points Question 12 When a note is dishonored, the payee will make an accounting
entry that includes a debit to Notes Receivable. True False 2 points Question 13 An example of a contingent liability is: A. accounts payable. B. federal excise tax
payable. C. salaries payable. D. potential loss from a lawsuit. 2 points Question 14 The preemptive right refers to a stockholder’s right to receive dividends
when they are declared by the board of directors. True False 2 points Question 15 The date of record (of dividends) is the date established by the board of directors
to determine who will receive a dividend. True False 2 points Question 16 One of the most basic rights of the stockholder is the right to vote at stockholders’
meetings in person or by proxy. True False 2 points Question 17 The market value of a stock depends on a number of factors, including investors’ expectations regarding
the future performance of a corporation. True False 2 points Question 18 When Retained Earnings is debited in a journal entry, a deficit exists. True False 2 points
Question 19 Which of the following statements regarding earnings per share is correct? A. Earnings per share and book value per share are equal. B.
Earnings per share is calculated for all shares of stock that have been issued by the corporation. C. Only one earnings per share figure will appear on the income
statement for each period. D. Earnings per share is equal to net income divided by the weighted-average number of common shares outstanding if the corporation has no
preferred stock outstanding. 2 points Question 20 Treasury stock is stock that: A. is apportioned to cover special projects such as the construction of a new
building. B. has been issued but was reacquired by the corporation. C. must be offered to existing stockholders first in amounts proportional to their
shareholdings of the issuer’s stock. D. has never been issued. 2 points Question 21 The price-earnings ratio is computed by dividing the current market price per share
of common stock by earnings per share. True False 2 points Question 22 The charter is the contract between the state and the incorporators which gives the corporation
its separate legal existence. True False 2 points Question 23 The three significant cash dividend dates are the date of declaration, date of record, and date of
payment. True False 2 points Question 24 Which of the following is a characteristic of a corporation? A. Separate legal existence B. Shareholders may enter
into a contract on behalf of the corporation C. Difficult transferability of ownership because of widely scattered ownership D. Full liability of owners to corporate
creditors 2 points Question 25 The three significant cash dividend dates are (in order) the dates of: A. declaration, record, and payment. B. record,
distribution, and payment. C. declaration, record, and distribution. D. declaration, distribution, and payment. 2 points Question 26 In The Profit’s A Stein
Meats Receivables Video clip, Jamie, Marcus’ Portfolio Manager, uncovers that Stein Meats owes how much in liabilities? $500,000 $7.8 million $4 million $2 million 2
points Question 27 In The Profit’s A Stein Meats Receivables Video clip, it is easy to collect monies from customers who are past due. True False 2 points Question 28
In The Profit’s A Stein Meats Receivables Video clip, what is the main reason that Stein Meats is struggling financially? They don’t sell enough meat. They extend
credit to their customers and don’t collect from them. Employees are stealing. They owe too much to the bank. 2 points Question 29 In The Profit’s A Stein Meats
Receivables Video clip, how much money does Stein Meats have in the bank to pay their bills? $30,000 $300,000 $500,000 $4 million 2 points Question 30 In The Profit’s
A Stein Meats Receivables Video clip, how much revenue does Stein Meats do annually? $18 million $4 million $50 million $1 million
