13) The Samuel Company uses the straight-line method to depreciate its equipment. On May 1, 2015, the company purchased some equipment for $224,000. The equipment is estimated to have a useful life of ten years and a salvage value of $20,000. On December 31, 2015, how much depreciation expense should Samuel record for the equipment in the adjusting entry?

$20,400

$18,500

$8,500

$13,600

14) On November 1, 2015, the Morrison Company purchased a two-year umbrella insurance policy for $3,600 and recorded the transaction by debiting Prepaid Insurance and crediting Cash. Which of the following adjusting entries would be used by Morrison to properly account for prepaid insurance on December 31, 2015?

Insurance Expense		300
	Prepaid Insurance			300

Insurance Expense		300
	Accumulated Amortization -Insurance			300

Prepaid Insurance		1,800
	Cash			1,800

Prepaid Insurance		3,600
	Insurance Expense			3,600

15) The income statement is an important financial statement for all of the following reasons, except

the income statement helps shareholders evaluate management's operating effectiveness.

the income statement reports the amount of net cash inflows resulting from operating, financing, and investing activities to users.

the income statement provides useful information concerning the corporation's ability to generate sufficient cash flows from operations for use in payment of its operating obligations.

past income statements can be useful indicators in predicting current and future cash dividend payments as well as future stock prices.