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HW 3-CH2 Q1: Choose the correct answer for the following questions: 1. Larson Company on July 15 sells merchandise on account to Stuart Co. for $1.000, terms 2/10,n/30. On July 20 Stuart Co. retums merchandise worth $400 to Larson Company. On July 24 payment is received from Stuart Co. for the balance due. What is the amount of cash received? 2. Using the allowance method, the uncollectible accounts for the year is estimated to be $28,000. If the balance for the Allowance for Doubtful Accounts is a $7,000 debit before adjustment, what is the amount of bad debts expense for the period? 3. Using the allowance method, the uncollectible accounts for the year is estimated to be $28.000. If the balance for the Allowance for Doubtful Accounts is a $7,000 credit_before adjustment, what is the amount of bad debts expense for the period? 4. When an account becomes uncollectible and must be written off: a. Allowance for Doubtful Accounts should be credited b. Accounts Receivable should be credited. c. Bad Debts Expense should be credited. d. Sales should be debited. 5. To record estimated uncollectible accounts using the allowance method, the adjusting entry would be a: a debit to Accounts Receivable and a credit to Allowance for Doubtful Accounts. b. debit to Bad Debts Expense and a credit to Allowance for Doubtful Accounts c. debit to Allowance for Doubtful Accounts and a credit to Accounts Receivable. d. debit to Loss on Credit Sales and a credit to Accounts Receivable

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