When the Federal Reserve System Was Established

question 41

Multiple Choice

When the Federal Reserve System was established,

• A)all banks were required to become members
• B)only federally chartered banks were allowed to join
• C)only federally chartered banks were required to join
• D)most banks joined even though none were required to join
• E)membership was required for all banks in some states,but not in others

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Definitions:

Adjusting Entry

An accounting journal entry made at the end of an accounting period to allocate income and expenditures to the appropriate period, ensuring compliance with the accrual basis of accounting.

Allowances for Doubtful Accounts

A contra-asset account that reduces the total amount of accounts receivable to reflect the portion that is estimated not to be collected.

Net Realizable Value

The estimated selling price in the ordinary course of business, minus the estimated costs of completion and the costs necessary to make the sale.

Bad Debt Expense

A provision for accounts receivable that are considered unlikely to be collected.