Accounts Payable and Receivable Flashcards
7 cards from real Robert Half Assessment Test practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Accounts Payable and Receivable flashcards as text
When a company receives a credit memo from a vendor, what is the correct accounting treatment?
Answer: Debit Accounts Payable, Credit Purchases Returns and Allowances (or the relevant expense account)
A vendor credit memo reduces the amount owed to that vendor, so Accounts Payable is debited and the purchase returns/expense account is credited.
What is the purpose of an AP subledger?
Answer: To track the detailed balance owed to each individual vendor
The AP subledger maintains a separate balance for each vendor, and the total of all subledger balances must agree with the AP control account in the general ledger.
Which of the following is an example of a cash application in accounts receivable?
Answer: Posting a customer's check payment against their open invoice
Cash application is the process of matching and posting incoming customer payments to the correct open invoices in the AR system.
A company uses the percent-of-sales method for estimating bad debts. If credit sales are $800,000 and the historical bad debt rate is 1.5%, what is the bad debt expense?
Answer: $12,000
$800,000 × 1.5% = $12,000 bad debt expense recorded for the period.
What does 'net 30' mean on a vendor invoice?
Answer: Full payment is due within 30 days of the invoice date with no early-pay discount
Net 30 means the entire invoice balance is due within 30 days of the invoice date, with no early-payment discount offered.
Which report is MOST useful for prioritizing daily collection calls in AR?
Answer: The accounts receivable aging report
The AR aging report categorizes outstanding customer balances by how long they are past due, helping collectors focus on the oldest and largest overdue accounts first.
What is 'float' in the context of accounts payable check disbursements?
Answer: The time between when a check is written and when it clears the company's bank account
Float is the period between check issuance and bank clearance, during which the company retains use of the cash and the bank balance has not yet decreased.