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5. On March 1, 20D, Maddux Company purchaed arong oil well at a cash cost of $1,000,000. It is estimated that 1,500,000 barrels of oil can be produced over the remaining life of the well, By December 31, 20D (end of the accounting period), 150,000 barrels of oil were produced and sold. The amount of depletion expense for 20D on this well would be A) $100,000 B) $125,000. C) 90,000. D) $85,000 E) None of the above is correct. lb. Which generally accepted accounting principle best supports the establishment of the account, allowance for doubtful accounts? A) Matching principle. B) Continuity principle. C) Exception principle. D) Revenue principle. E) Comparability principle,' 17. Two systems are used in accounting for inventory -perpetual and periodic. Which of the following statements is correct? inventory system, the inventory account is not changed for each purchaise during the accounting period. B) In a perpetual inventory system, cost of goods sold is recorded at the time of each sale during the accounting period. ' C) In a periodic inventory system, cost of goods sold is developed from a comparison. of begining ., inventory and ending inventory only. ' D) In a periodic inventory system, the inventory account is increased for each purchase during the accounting period. E) None of the above is correct. 19. When the allowance mthod is used, the entry which is appropriate when a particular account is written off as uncollectible should include a A) debit to accounts receivable. B) debit to bad debt expense. C) debit to allowance for doubtful accounts D) debit to sales revenue. E) None of the above is correct. Id . A company usin g the periodic inventory system correctly recorded a purchase of merchandise, but the merchandise was not included in the physical inventory ount at the end of the accounting period. The error caused an: A) understatement of both net income and assets. B) overstatement of inventory, purchases, and accounts payable. C) understatement of inventory, purchases, and accounts payable. D) overstatement of net income and assets E) None of the above is correct