. Alpha Company reports operating expenses in two categories: (1) selling, and (2) general and administrative. The adjusted trial balance at December 31, year l included the following expense and loss accounts $120,000 Accounting and legal fces Advertising Freight-out Interest Loss on sale of long-term investment Officers salaries Rent for office space Sales salaries and commissions 150,000 80,000 70,000 30,000 225,000 220,000 140,000 One-halfof the rented premises is occupied by the sales department. Brock's toae expenses for year 1 are: a. $480,000 b $400,000 e $370,000 d S360,000 2. In which of the following situations is the units-of production method of depreciation most appropriate? a. An asset's service potential declines with use. b. An asset's service potential declines with the passage of time e. An assct is subjcct to rapid obsolescencc. d An asset incurs incrcasing repairs and maintenance with use 3. Wichita Company wrote of $100,000 of obsolete inventory at December 31, year 2. The effect of this write-off was to decrease: a. Both the current and acid-test ratios, b Only the current ratio. e. Only the acid-test ratio, d Neither the current nor the acid-test ratios. 4. On July1, year 1, Knight Co. received S103,288 for $100,000 face amount, 12% bonds, a price that yields 10%. Assuming management does not clect the fair value option, interest expensc for the six months ended December 31, year 1, should be: a $6,197 b. $6,000 c. $5,164 d S5,000 s. On the Statement of Activities for a private not-for-profit performing arts center, expenses should be deducted from: I Unrestricted revenues. . Temporarily restricted revenues Im. Permanently restricted revenues. a I, II, and III b. Both I and II c I only d. I only