1. Bad Debts Expense is reported on the income statement

A. Part of cost of goods sold.

B. an expense subtracted from net sales to determine gross profit

C. An operating expense

D. A contra revenue

2. A company purchased factory equipment on June 1, 2012, for $80,000. It is estimated that the equipment will have a $5,000 salvage value at the end of its 10-year useful life. Using the straight-line method of depreciation, the amount to be recorded as depreciation expense at December 31, 2012, is

A. $7,500.

B. $4,375

C. $3,750.

D. $3,125

3. Which of the following would not be included in the defnition of cash?

A. Money on ddeposit

B. Coins

C. NSF Checks

d. Petty Cash