1. (a) "The steps in the accounting cycle for a merchandising company are different from the accounting cycle for a service company." Do you agree or disagree? (b) Is the measurement of net income for a merchandising company conceptually the same as for a service company? Explain. 2. a. Girard Company ships merchandise to Liu Company on December 30 . The merchandise reaches the buyer on January 6 . Indicate the terms of sale that will result in the goods being included in (1) Girard's December 31 inventory, and (2) Liu's December 31 inventory. b. Under what circumstances should Girard Company include consigned goods in its inventory? 3. Explain the difference between the terms FOB shipping point and FOB destination. 4. Identify the five components of a good internal control system. 5. "Internal control is concerned only with enhancing the accuracy of the accounting records." Do you agree? Explain. 6. What principles of internal control apply to most organizations? 7. Riverside Fertilizer owns the following assets at the statement of financial position date. Cash in bank savings account 8,000 Cash on hand 850 Cash refund due from taxing authority 1,000 Checking account balance 14,000 Postdated checks 500 What amount should Riverside report as cash in the statement of financial position? 8. Your roommate is uncertain about the advantages of a promissory note. Compare the advantages of a note receivable with those of an account receivable. 9. Distinguish between revenue expenditures and capital expenditures during an asset's useful life. 10. Often, research and development costs provide companies with benefits that last a number of years. (For example, these costs can lead to the development of a patent that will increase the company's income for many years.) However, IFRS requires that many such costs be recorded as an expense when incurred. Why