1. Eagles Nest sold equipment for $4,000 cash. This resulted in a $1,500 loss. What is the impact of this sale on the working capital? a. Reduces working capital b. Increases working capital c. Has no effect on working capital d. The increases offset the decrease.

2. Boalsburg Co. purchased a truck on January 1, 2015, for $30,000. The truck had an estimated life of five years and an estimated residual value of $5,000. Boalsburg used the straight-line method to depreciate the asset. On July 1, 2017, the truck was sold for $17,000 cash. The journal entry to record the sale of the truck in 2017 a. increases net income. b. increases total assets. c. decreases total expenses. d. decreases stockholders equity.

3. On January 1, 2017, Sharpsburg, Inc. issued $400,000, ten-year, 10% bonds for $354,200. The bonds pay interest on June 30 and December 31. The market rate is 12%. What is the carrying value of the bonds after the first interest payment is made on June 30, 2017? a. $352,960 b. $354,200 c. $355,452 d. $400,000

4. Amortization of a bond premium results in a. a decrease of the carrying value of bonds. b. no change in stockholders equity. c. an increase in interest expense. d. a decrease in the Cash account.