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W13 Acct110 COMPREHENSIVE PRACTICE Final Exam

Question One: A/R and Bad debts (15 minutes)
Part One. Read each transaction and record the appropriate journal entry for Morrison Consultants, which has a June 30 year end. Explanations are NOT required
1. On June 30 2012, Morrison prepares an aging schedule of accounts receivable that shows estimated uncollectible accounts of $5,200. Before journal entries, the Allowance for Doubtful accounts has a debit balance of $300 and Accounts Receivable has a balance of $85,000.
2. On July 5, Morrison was notified that Sperry Ltd has declared bankruptcy and Morrison writes off its A/R of $800.
3. On September 12, Sperry notifies Morrison that it can pay its $800 debt and includes a cheque for the entire amount.
Part Two.
1. What is the net realizable value of the accounts receivable at June 30, 2012? ______________
2. What is the net realizable value of the accounts receivable at July 5, 2012? _______________
Date

Account

Debit

Credit

Calculations:

There is no representation that the practice questions reflect the actual exam questions.

1|Page

Camosun College W13 Acct110 COMPREHENSIVE PRACTICE Final Exam

B. Edwards

Question Two: Capital Assets and amortization. (30 minutes)
Townsend Engineers owns a piece of machinery that it purchased 3 years ago for $40,000. The machinery has an estimated salvage value of $5,000 and an estimated useful life of 10 years.
Straight-line amortization is used. At December 31, 2011, the accumulated amortization account had a balance of $10,500. On April 1, 2013 Townsend sold the machinery for $27,000.
1. Record the amortization on December 31, 2012.
2. Record all of the necessary journal entries to record the sale of machinery on April 1, 2013.
Date

Account

Debit

Credit

Calculations:

There is no representation that the practice…...

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