6. Research and development costs for projects A. Expensed in the period incurred 5. Expensed in the period they are determined to be unsuccessful. other than software development should be pending determination of success. Expensed if unsuccessful, capitalized if successful. 7. A contingent loss should be reported in a footnote to the financial statements rather than being accrued if A. The likelihood of a loss is remote. B. The incurrence of a loss is reasonably possible. C. The incurrence of a loss is more likely than not. D. The likelihood of a loss is probable. 8. Funz y Cereal includes one coupon in each package of Wheatos that it sells and offers a toy car in exchange for $1.00 and 3 coupons. The cars cost Funzy $1.60 each. Experience indicates that 40% of the coupons eventually will be redeemed. During the last month of 2011, the first month of the offer, Funzy sold 12 million boxes of Wheatos and 2.4 million of the coupons were redeemed. Wh at amount should Funzy report as a promotional expense for coupons on its December 31, 2011, income statement? A. $O. B. $400,000. C. $800,000. D. $960,000. 9. At the beginning of 2011, Angel Corporation began offering a 2-year warranty on its products. The warranty program. was expected to cost Angel 4% of net sales. Net sales made under warranty in 2011 were $180 million. Fifteen percent of the units sold were returned in 2011 and repaired or replaced at a cost of $5.3 million. The amount of warranty liability on Angel's December 31, 2011 balance sheet statement is: A. $5.3 million. B. $7.2 million. C. $10.6 million. D. $1.9 million. 10. The rate of interest that actually is incurred on a bond payable is called the A. Face rate B. Contract rate. C. Effective rate. D. Stated rate