Group $4$ True or False:$-$

$22-$Excess inventory is treated as subnormal goods and is valued at the bona fide selling price less the direct cost of disposition under the lower of cost or market rules.

True

False

$23-$Trade discounts are usually considered adjustments to the purchase price and are available to the purchaser without regard to the timeliness of payment.

True

False

$24-$An example of an applicable financial statement for purposes of the repair and maintenance regulations is a financial statement required to be filed with the Securities and Exchange Commission $($example: $10-$K$).$

True

False

$25-$A condition for the use of LIFO is that LIFO inventories must be stated at cost$.$

True

False

$26-$Non$-$incidental supplies are expensed as consumed whereas incidental supplies are expensed when paid.

True

False

$27-$Treasury Reg. $1\mathrm{.}61-7($d$)$ provides for the proceeds of a sale to be allocated first to accrued interest and then only the balance to be treated as the amount realized on the sale. By applying proceeds of a sale first to accrued interest, it is possible to have interest income and a capital loss realized on the sale.

True

False

$28-$Megair Corp. manufactures two types of airplanes: small, general aviation planes that require approximately six months to complete and large jet aircrafts sold to airlines that require two years to complete. Megair maintains an inventory of the small planes but manufactures the large planes to contract specification. Megair must use the long$-$term contract accounting rules for both types of planes.

True

False