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If a retailer regularly sells its receivables to a factor, the service charge
of the factor should be classified as a(n)
contra asset.
other expense.
selling expense.
interest expense.
14Multiple Choice Question 104
During 2013, Alfred Inc. had sales on account of $132,000, cash sales
of $54,000, and collections on account of $84,000. In addition, they
collected $1,450 which had been written off as uncollectible in 2012.
As a result of these transactions, the change in the accounts receivable
balance indicates a
$102,000 increase.
$100,550 increase.
$46,550 increase.
$48,000 increase.
15Multiple Choice Question 142
A 5%, 120-day note receivable is received from a customer to settle an
existing account receivable of $75,000. Assuming a 360 day year, the
accounting entry for acquisition of the note will include a
debit to Notes Receivable for $75,000 and no entry for interest.