A contra revenue account

	a.	does not have any effect on sales revenue
	b.	increases asset
	c.	increases gross sales revenue
	d.	reduces gross sales revenue

The use of LIFO in accounting for a firm's inventory:

		Usually matches the physical flow of goods through the business.
		Is usually used for internal management purposes.
		Usually provides a better match of expenses with revenues.
		None of these answer choices are correct.

Morgan Company uses the periodic inventory system. If Morgan's ending inventory is understated due to an accounting error, what is the effect on net income and the ending balance of retained earnings?

	a.	Net Income is overstated, and Retained Earnings is overstated
	b.	Net Income is understated, and Retained Earnings is overstated
	c.	Net Income is understated, and Retained Earnings is understated
	d.	Net Income is overstated, and Retained Earnings is understated

1. Which of the following would usually NOT happen in a single business transaction?

   	a.	Decrease assets, decrease equity
   	b.	Increase assets, decrease liabilities
   	c.	Increase liabilities, decrease equity
   	d.	Increase assets, increase liabilities

On July 1, 2019, Wasson Company purchased a delivery vehicle costing $35,000. Wasson also insures the vehicle while it is in transit from the vendor for $5,000. Once the vehicle is on site, Wasson pays $10,000 for the first year of insurance coverage. The vehicle has an estimated 6-year life and a $4,000 residual value. What is the vehicle's accumulated depreciation as of December 31, 2020 assuming Wasson uses the straight-line depreciation method?

	a.	$9,000
	b.	$11,500
	c.	$12,000
	d.	$7,750