1.2 Which of the following is true? When a company takes out a loan: A. Cash decreases, liabilities decrease B. Cash increases, owner's equity stay the same C. Liabilities increase, owner's equity increases D. Cash increases, owner's equity decrease 1.3 When the accountant has to choose between two acceptable alternatives, the accountant should select the alternative that will report less profit, less asset amount, or a greater liability amount. This is based upon which accounting concept/principle? A. Accruals B. Consistency C. Matching D. Prudence 1.4 Trademarks, Patents and Copyrights are A. Current assets B. Non-current assets C. Intangible assets D. Investments 1.5 Which of the following is an external user of financial statements? A. Manager of the business B. Chief Executive Officer of the business C. Trade payables of the business D. Employees of the business