Which Entry Would Be the Correct Entry to Record That

question 15

Multiple Choice

Which entry would be the correct entry to record that a not-for-profit entity collected $80,000 of amounts pledged and also wrote off $3,000 of amounts pledged that were previously estimated as amounts uncollectible? DEBIT CREDIT

• A) Pledges Receivable $80,000 Cash $80,000
• B) Cash $80,000 Pledges Receivable $80,000
• C) Pledges Receivable $80,000 Allowance for uncollectible pledges 3,000 Cash $83,000
• D) Cash $80,000 Pledges Receivable $83,000 Allowance for uncollectible
• Pledges $3,000
• E) Cash $80,000 Unrestricted net assets-contributions $83,000 Allowance for uncollectible
• Pledges $3,000

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Definitions:

Merchandise Return

Occurs when a customer returns a product to the seller for a refund or exchange due to dissatisfaction or defects.

Perpetual Inventory System

An inventory management system that tracks the sale and restock of inventory items in real-time.

Merchandise

Products that are purchased, stored, and sold by businesses, typically in the retail industry.

Cash Payment

A transaction in which a payment is made in the form of physical currency or through a digital mechanism but representing immediate transfer of funds.