QUESTION 21

1. Both Land and Land Improvements will generally be depreciated.

   True

   False

2.65 points

QUESTION 22

1. On June 1, $800 of goods are sold with credit terms of 1/10, n/30. How much should the seller expect to receive if the buyer pays on June 8?

   		$720
   		$784
   		$792
   		$800

2.65 points

QUESTION 23

1. The receivable turnover ratio is computed by dividing the net credit __________ for the year by the average amount of accounts receivable during the year.

   		Inventory
   		Sales
   		Cost of Sales

2.65 points

QUESTION 24

1. The inventory system that does NOT update the Inventory account automatically at the time of each purchase or sales is the _______________ method/system.

   		Periodic
   		Perpetual

2.65 points

QUESTION 25

1. If a company is experiencing continuous cost increases for the merchandise that it purchases, which cost flow assumption will result in the least amount of profit and the least amount of income tax expense?

   		FIFO
   		LIFO
   		Average

2.65 points

QUESTION 26

1. When the terms of a sale are FOB _________, ownership of goods will transfer to the customer at the customer's dock.

   		Shipping Point
   		Destination

2.65 points

QUESTION 27

1. The inventory cost flow assumption where the cost of the most recent purchases are likely to remain in inventory

   		FIFO
   		LIFO
   		Average

2.65 points

QUESTION 28

1. Like all intangible assets goodwill is amortized over its expected life to the business or legal life whichever is shorter

   True

   False

2.65 points

QUESTION 29

1. After several years of operations, a company's Bad Debts Expense for a given year is likely to be the same as its balance in Allowance for Doubtful Accounts

   True

   False

2.65 points

QUESTION 30

1. In financial accounting, Goodwill is an asset a company obtains by doing good deeds in their community

   True

   False