1. Depreciation reduces cash and reduces net income. ( TRUE OR FALSE )
2. A capital expenditure (purchase of a fixed asset) reduces cash but does not change net income. ( TRUE OR FALSE )
3. Borrowing money will increase cash and reduce liabilities ( TRUE OR FALSE )
4. The payment to a supplier for a previous purchase of inventory decreases both assets and liabilities. ( TRUE OR FALSE )
5. The sale of merchandise will only have an impact on net income when the payment is collected. ( TRUE OR FALSE )