1) T F If collections of pledges (from contributors) for a period exceed pledges of contributions received for the same period, the balance in pledges receivable increases. 2) T F A lease agreement may be classified as a capital lease even if title of the leased asset does not transfer to the lessee at some time during the term of the lease. 3) T F If the balance of inventory at the end of the year is overstated (and the beginning balance and purchases for the year were correctly stated), the reported income for the year is understated. 4) T F Failure by a company to accrue interest on a loan payable at the end of a year results in an overstatement of income for the period. 5) T F The accruing of an expense at the end of a period is offset by a decrease in the reported value of net assets (i.e., net assets decrease by exactly the amount of the expense accrued). 6) T I In the typical manufacturing firm, income is recognized at completion of the production process when finished products are transferred to the finished goods inventory. 7) T F In accordance with generally accepted accounting principles, the recognition of revenue and expenses is based on the accrual method of accounting. 8) T D Dividends declared reduce a company's retained eamings but are not deducted as an expense in arriving at net income for a period. 9) T F For a lessee, depreciation and interest expenses under a finance lease will always be greater than rent expense under an operating lease over the term of the lease. 10) T F Reclassifying net assets from restricted to unrestricted decreases the balance of net assets