12) Which of the following statements is TRUE?

A) Accounts receivable are more liquid than cash.

B) Notes receivable are always classified as current assets.

C) Notes receivable usually have longer collection terms than accounts receivable.

D) Accounts receivable are liabilities.

13) Notes receivable ________.

A) represent an oral promise to pay a fixed amount of principal plus interest on the maturity date

B) are included in a miscellaneous category called other receivables

C) due within 12 months or within the normal operating cycle if the cycle is longer than a year are considered long-term assets

D) are supported by a promissory note

True or False

14) Credit department employees must have access to cash in order to exercise effective internal control over receivables.

15) Separation of cash-handling and cash-accounting duties is a critical element of internal control over receivables.