Hotel expense accounting - Accounting for bad debts
10 important questions on Hotel expense accounting - Accounting for bad debts
Allowance method
Net credit sales
(general journey)
x % estimated uncolectible
= amount of journal entry
Percentage of credit sales
In 2018, Kid’s Clothes had credit sales of $60,000. Past experience indicates that bad debts are one percent of sales.
What is the estimate of bad debts expense for 2018?
General journey
Provision for doubtfull account 600
Allowance for doubtful account credit 600
1.Which of the following is not a financial reporting center in a hospitality business?
a.Rooms department
b.Food and beverage department
c.Service bar
d.Utility costs
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2.Which of the following is not classified as a support center within a hospitality business? a. Administrative and general
b. Telecommunications
c. Human resources
d. Information Systems
3. Which of the following is not a direct expense properly allocated to a particular department within a hospitality business?
a. Cost of sales
b. Payroll
c. Operating supplies
d. Insurance
Which of the following is not an expense account associated with the food and beverage department?
a. China, glassware, silver, and linen
b. Kitchen fuel
c. Credit card commissions
d. Menus
. If a hotel accepts MasterCard, Visa, and American Express cards and if a guest uses one of these cards to purchase food and beverages, the credit card fee will be charged to the:
a. marketing department.
b. F&B department.
c. A&G department.
d. schedule of rentals and other income.
6. Water used in the F&B department is charged to the:
a. F&B department.
b. schedule of utility costs.
c. A&G department.
d. property operation and maintenance department.
7. When received from guests, nonbank credit card drafts are:
a. treated the same as cash.
b. recorded as accounts receivable.
c. accounted for using the allowance method.
d. classified as uncollectable accounts.
8. Gas used to heat guestrooms is charged to the:
a. rooms department.
b. schedule of utility costs.
c. A&G department.
d. property operation and maintenance
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