16. Which account increases with a debit? a. Revenue b. Unearned revenue c. Retained earnings d. Cost of goods sold 17. Where does interest expense appear on the income statement? a. Gross profit calculation b. Operating expenses section c. Non-operating section d. Financing section 18. Busy Beauty fears that an employee is stealing beauty products after its physical inventory count revealed an inventory balance that was $500 lower than the account records show. Which inventory system does Busy Beauty use? a. Perpetual System b. Periodic System c. Specific Identification Method d. None of the above 19. Which transaction decreases the allowance for doubtful accounts? a. Write-off of an uncollectible account b. Uncollectible account estimate at year-end c. Sale to a customer on account d. Allowance for doubtful accounts never decreases 20. A company purchased $5,000 of office supplies on account. Is this a revenue, expense or neither? a. Revenue b. Expense c. Neither