ACCT test 3 formulas

Question 1

Current Ratio =?

Answer 1

Current Assets/Current Liabilities

Question 2

Working Capital = ?

Answer 2

Current Assets − Current Liabilities

Question 3

Age of Receivables = ?

Answer 3

Receivables/Sales per Day

Question 4

Receivables Turnover = ?

Answer 4

Sales/Average Receivables

Question 5

amount of cash collected from receivables

Answer 5

sales on credit - balance in receivables

Question 6

uncollectible accounts estimated at % of credit sales

Answer 6

sales on credit x %

Question 7

The percentage of sales method computes doubtful accounts expense by anticipating the percentage of sales that will eventually ——

Answer 7

failed to be collected

Question 8

net realizable value of the receivables

Answer 8

balance in accounts receivable - credit sales will not be collected

Question 9

If the ending balance in account receivables is !, the amount of cash collect in Year Two is

Answer 9

beg balance - ending balance + credit sales - wrote off receivables

Question 10

The net realizable value of accounts receivable is the

Answer 10

difference between the ending accounts receivable balance and the allowance for doubtful accounts.