16 Choose: When constructing a depreciation schedule, the accountant must remember that the book value at the end of the asset's life must be equal to the a. salvage value tcost c book value d. depreciable cost 17 Choose: Clark sold an asset this year for $4,000, but the book value of the asset was $7,000. What effect will this transaction have on the income statement for the year? A. an increase in net income b. a decrease in net income c. no effect on net income d. we don't know 18 Choose: Social Security is a government program that a. provides income to citizens after they retire h. pays people when they become unemployed C. provides vacation pay to working people d. none of these 19 Choose: Tom and Jerry went into business as a partnership with Tom investing cash of $90,000 and Jerry investing $10,000. They had no partnership agreement. It they incur a $20,000 loss, how must they split the loss? A. in the ratio of their investment b. 90:10 c. 50:40 d. 50:50 20 Choose: Social Security taxes (Social Security and Medicare) are paid by... a. employee only b. employer and employee c. neither employer nor employee d. employer only 21 Choose: Grandfork Company purchased a patent for $32,000 on July 1, 2020. The patent has a life of 8 years, no salvage value. If Grandfork records patent amortization on December 31, 2020, how much Patent Expense will be recorded? a. $32,000 b. $2,000 c. $4,000 d. None of these 22 Choose: Libby Mining purchased an iron mine for $3,000,000. The mine is expected to produce 100,000 tons of Iron ore during its life. This year, Libby extracted 20,000 tons of ore. How much depletion expense should Libby record this year? a. $30,000 b. $600,000 c. $3,000,000 d. $300,000 23. Choose: Williams purchased equipment with a cost of $28,000, life of 5 years and salvage value of $3,000. What is the depreciable cost of the equipment? a. $20,000 b. $5,000 C..20 d. $25,000 24 Choose: What is the name of the payroll document published by the Internal Revenue Service that contains the tax rates and withholding information used by payroll managers? a. Your Payroll Pal b. Publication 15 Circular E c. Your Role in Payroll c. 50 Shades of Payroll 25 Choose: Which of the following is an accelerated depreciation method that is used only for tax purposes? a. MACRS b. Straight Line c. Units of Activity d. Double Declining Balance