Reference no: EM132662640

Problem 1: Including a sign on a convenience store's cash register that says "If you don't receive a receipt, your purchase is free" is an internal control for Cash.

• True
• False

Problem 2: Approximately __% of accounting frauds involve improper revenue recognition.

Option 1: 61%

Option 2: 50%

Option 3: 32%

Option 4: 76%

Problem 3: Before making its end-of-period adjusting journal entry to record the bad debt expense estimate, Frito Company has a debit balance in its Allowance for Doubtful Accounts of $5,000. An aging analysis suggests that the estimated amount of uncollectible accounts receivable at the end of the period is $30,000. Frito should make the following adjusting entry:

Option 1: Dr. Bad Debt Expense 25,000 and Cr. Allowance for Doubtful Accounts 25,000

Option 2: Dr. Bad Debt Expense 35,000 and Cr. Allowance for Doubtful Accounts 35,000

Option 3: Dr. Bad Debt Expense 30,000 and Cr. Allowance for Doubtful Accounts 30,000