21 The following are all expenses except (A) depreciation (B) advertising (C) cost of goods sold (D) dividends (E) income taxes 2. Which of the following accounts is used and found on financial statements prepared using the accrual basis of accounting but not used and found on financial statements using the the cash basis of accounting? (A) Unearned revenues (B) Wages payable (C) Accounts receivable (D) Prepaid services (E) all of the above 23 Which of the following does not effect Stockholder's Equity? (A) Investments by owner(s) (B) Payment of a liability (C) Incurring an expense (D) Declaration of a Cash Dividend (E) all of the above effect stockholder's equity 24 The Robert Edward Company sells $2,500 worth of merchandise on March 17. The credit terms are 210, n/30. If customer pays on March 30, the cash discount is? 50 250 750 (E) none of the above 25 Which 2 Which of the following is an example of a deferral? (A) A customer collection received in advance (B) Estimated income tax for the year (c) interest expense incurred buy not yet paid (D) Fees earned but not yet collected (E) The sale of merchandise on credit 26 Which of the following is an example of an accrual? (A) Equipment purchased to be used in the business (B) Fees collected but not yet earned (C) interest earned but not yet received (D) Six months rent paid in advance (E) The recognition of Depreciation expense C1 A company's warehouse was destroyed by a tornado on March 15. 27 A com The following information was the only information that was salvaged: Inventory, beginning $28,000 Purchases for the period $17,000 Sales for the period $55,000 Sales returns for the period $700 The company's average gross profit ratio is 35%. What is the estimated cost of the lost inventory? (A) $9,705 (B) $25,995 $29,250 $44,000 (E) $45,000