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The decision to sell to extend credit to customers will decrease wage costs. True or False True False The aging of accounts receivable method focuses on estimating the ending balance to be reported in the Allowance for Doubtful Accounts, whereas the percentage of credit sales method focuses on estimating Bad Debt Expense for the period. True or False True False When interest is calculated for periods shorter than a year, the formula to calculate interest is: Multiple Choice I=PxRxT, where I = Interest calculated, P = principal, R= annual Interest rate, and T = number of months. I = Px RXT, where I = Interest calculated, P = principal, R = annual Interest rate, and T = (number of months = 12). I =P*R*T, where I = Interest calculated, P = principal, R = monthly Interest rate, and T = (number of months = 12). 1 = (MV - P)/T, where I = Interest calculated, MV = maturity value, P = principal and T= number of months. Inglewood Industries has net sales of $936,600 and average net receivables of $223,000 for the year. Which of the following statements is correct? (Round all calculations to one decimal place.) Multiple Choice The receivables turnover ratio is 4.2 and the days-to-collect is 0.01. The receivables turnover ratio is 0.2 and the days-to-collect is 1,520. The recelvables turnover ratio is 4.2 and the days-to-collect is 86.9 O The receivables turnover ratio is 0.2 and the days-to-collect is 87.6. The useful life of an asset is always measured in units of time, such as years or months. True or False True False Extraordinary repairs, replacements, and additions are added to the appropriate asset accounts rather than being recorded as expenses. True or False True False When a company sells a long-lived asset, stockholders' equity will change by the: Multiple Choice amount of the sale amount of the asset's book value. amount of the asset's Accumulated Depreciation. difference between the sales price and the asset's book value. Assuming two companies use the same accounting methods, other things being equal, the company with a higher fixed asset turnover ratio: Multiple Choice has a greater amount invested in fixed assets than a company with a lower fixed asset turnover ratio. O has less Invested In fixed assets than a company with a lower fixed asset turnover ratio. generates less sales revenue than a company with a lower fixed asset turnover ratio. O makes better use of its fixed assets to generate revenues than a company with a lower fixed asset turnover ratio. O The debt-to-assets ratio indicates financing risk by computing the proportion of total assets financed by debt. True or False True False