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A debit memorandum on a bank statement indicates:

The payee is the person who signs a check, authorizing its payment.

A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $200 worth of merchandise. On July 28, it paid the full amount due. The amount of the cash paid on July 28 equals:

Allowance for Doubtful Accounts is a contra asset; its balance is added to Accounts receivable.

The impact of technology on internal controls includes:

A company had a gross profit of $300,000 based on sales of $400,000. Its cost of goods sold equals $700,000.

On March 12, Klein Company sold merchandise in the amount of $7,800 to Babson Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,500. Klein uses the perpetual inventory system and the gross method of accounting for sales. Babson pays the invoice on March 17, and takes the appropriate discount. The journal entry that Klein makes on March 17 is:

Federal laws prohibit the selling of accounts receivables to factors.

The person that borrows money and signs a promissory note is called the maker.

Companies use two methods to account for uncollectible accounts, the direct write-off method and the allowance method.