After all the ledgers had been drawn up, the following differences and errors were identified.Indicate with a cross (X) where you would correct each of the differences and errors listed below,and explain your reasoning as so how, why and where you will make the correction:Hint: some might need to be corrected in more than one place.Difference or errorDebtors listDebtors controlEg. The totol sales return column inthe Debtors Allowance Journal wasposted to the debit side of the Debtors Soles returns reduce the omount owing by o debtor.Control Account.The error has occurred in the Debtors control accountonly, thus there wil be no impact on the individualdebtor's occount. The debtors control account shouldbe credited twice.A credit invoice (issued by thebusiness) has not been recorded at all.The Debtors control column in thedebtors journal was "undercast".Notification has been received that theoutstanding balance on one of thedebtors should be written off as thedebtor is insolvent.END OF PAPER

Debtor- It defines those persons who get goods from the entity not in cash but on credit or any…

Answered: After all the ledgers had been drawn…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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TOPIC: Rules of Debit and Credit Instruction: Identify the normal balance of accounts. Choose the letter of the correct answer. Choices: A. Debit B. Credit Questions: 1. Machinery 2. Estimated Uncollectible Account 3. Inventories 4. Amora, Drawing 5. Vehicle 6. Office Supplies Expense 7. Allowance for Doubtful Accounts 8. Service Revenue 9. Communication Expense 10. Miscellaneous Expense 11. Bad Debts 12. Mortgage Payable 13. Notes Payable 14. Prepaid Insurance 15. Unused Supplies 16. Allowance for Bad Debts 17. VAT Payable 18. Accumulated Depreciation 19. Taxes and Licenses 20. Retained Earnings
You have established your performance materiality for accounts payable and revenue; now you must determine the posting materiality for individual items. The materiality judgement is at 4%. What is the posting materiality? Show your work. Your work should look like: APPROPRIATE AMOUNT x MATERIALITY JUDGEMENT = POSTING MATERIALITY
Please help with the following question COMPLETION STATEMENTS 1.Notes and accounts receivable that result from sales transactions are often called______________ receivables. 2.Two accounting problems associated with accounts receivable are (1) ______________ and (2) ______________ accounts receivable. 3.The net amount expected to be collected in cash from receivables is the _____________. 4.When credit sales are made, _________________ Expense is considered a normal and necessary risk of doing business on a credit basis. 5.The two methods used in accounting for uncollectible accounts are the ____________ method and the ______________ method. 6.Allowance for Doubtful Accounts is a_____________ account which is ______________ from Accounts Receivable on the balance sheet. 7.When the allowance method is used to account for uncollectible accounts, ____________ is debited when an account is determined to be uncollectible. 8.The _________________ basis of…
Match each of the five items listed below with one of the following locations: 1. Located on the Income Statement debit column of the worksheet 2. Located on the Income Statement credit column of the worksheet 3. Located on the Balance Sheet debit column of the worksheet 4. Located on the Balance Sheet credit column of the worksheet a. Sales Returns and Allowances b. Accrued Salaries Payable c. Sales d. Merchandise Inventory e. Accounts Receivable a. Sales Returns and Allowance 1. Located on the Income Statement debit column of the worksheet 2. Located on the Income Statement credit column of the worksheet 3. Located on the Balance Sheet debit column of the worksheet 4. Located on the Balance Sheet credit column of the…
Flora Co. uses the allowance method of accounting for uncollectible accounts receivable. The entry to write off an account that has been determined to be uncollectible would be to debit a. Allowance for Doubtful Accounts and credit Accounts Receivable. Ob. Sales Returns and Allowances and credit Accounts Receivable. c. Accounts Receivable and credit Bad Debt Expense. Od. Bad Debt Expense and credit Allowance for Doubtful Accounts.
Identify the items from the following list that are likely to serve as source documents. Item a. Sales receipt b. Liability accounts c. Balance sheet d. Ledger e. Bank statement f. General journal g. Income statement h. Telephone bill i. Credit card receipt Is this a source document?
A company that records credit purchases in a purchases journal and records purchases returns in a general journal made the following errors. Enter A, B, or C indicating when each error should be discovered. A. When preparing the schedule of accounts payable. B. When crossfooting the purchases journal. C. When preparing the trial balance. 1. Made an addition error in totaling the Office Supplies column of the purchases journal. 2. Made an addition error in determining the balance of a creditor’s subsidiary account. 3. Posted a purchases return to the Accounts Payable account and to the creditor’s subsidiary account but did not post the purchases return to the Inventory account. 4. Correctly recorded an $8,000 purchase in the purchases journal but posted it to the creditor’s subsidiary account as an $800 purchase. 5. Posted a purchases return to the Inventory account and to the Accounts Payable account but did not post to the creditor’s subsidiary account.
Effective credit management involves establishing credit standards for extending credit to customers, determining the company’s terms of credit, and setting up procedures for invoicing and collecting past-due accounts. The following statement refers to a credit management policy. Select the best term to complete the sentence. The conditions of the credit sale, including cash discounts and due dates, are indicated by the company’s (______) . Consider the case of Newtown Co.: Newtown Co.’s CFO has decided to take a closer look at the company’s credit policy. Newtown Co. has annual sales of $402.8 million, and it currently has an accounts receivable balance of $47.6 million. The first step in analyzing the firm’s credit policy is to determine its days sales outstanding (DSO). Based on this information, Newtown Co.’s DSO is (_____) . (Note: Use 365 days as the length of a year in all calculations. Do not round intermediate calculations. Round your answer to one…
Select all that apply Which of the following statements are true? Credit entries produce increases in some account balances and decreases in other account balances. Increases in account balances are always recorded with debit entries. Decreases in account balances are always recorded with debit entries. Debit entries produce increases in some account balances and decreases in other account balances. Need help? Review these concept resources. Read About the Concept-
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