7, Sports Med sold an X-ray machine that originally cost $100,000 for $60,000. The accumulated depreciation on the machine to the date of sale was $40,000. On this sale, Sports Med should recognize:

a, $0 gain or loss.

b, $20,000 gain.

c, $25,000 gain.

d, $40,000 loss.

e, $60,000 gain.

8, The characteristics of a liability include:

a, Occurrence of a past transaction or event.

b, Existence of a present obligation.

c, Requirement of future payment of assets or rendering of services.

d, A liability can be current or long term.

e, All of these answers are correct.

9, Fees accepted in advance from a client:

a, Are recorded as earned revenues on the income statement.

b, Increase income.

c, Are recorded as liabilities.

d, Do not increase assets.

e, None of these answers is correct.

10, The difference between the amount received from a note payable and the amount repaid is:

a, Interest.

b, Principal.

c, Face value.

d, Discount.

e, Premium.