Question 6 (5 points) Saved If a plant asset is sold and a loss is incurred, the entry to record the sale would include a: O credit to Cash. u debit to Loss on Sale of Asset. O debit to Plant Asset. credit to Accumulated Depreciation. Question 7 (5 points) Saved Which of the following statements is TRUE? ) Allocating the cost of a plant asset over its useful life is called depletion. Allocating the cost of a natural resource to an expense is called depreciation. Intangible assets are amortized. Both A and B are true. Question 14 (5 points) Saved A contingent liability should be reported on the balance sheet if: D it is less than possible but more than remote that a loss will occur. it is the result of a lawsuit that is not yet settled. . it is probable that the loss will occur and the amount can be reasonably estimated. Contingent liabilities will never be reported on the balance sheet. Question 15 (5 points) Saved Which of the following is not a characteristic of a financing lease? The Lease transfers ownership of the asset to the lessor at the end of term. The Lease term is for the major part of the remaining economic life. The Lease grants the option, that the lessee is reasonably certain to exercise, for the lessee to purchase the asset. All of the above are true. The entry to record annual depreciation includes a: debit to Depreciation Expense. debit to Accumulated Depreciation. credit to Depreciation Expense. credit to the asset account. Question 27 (5 points) Saved When a company uses the effective-interest method to amortize bond discount, U Interest expense on each semi-annual interest payment date will be a constant amount Interest expense is calculated as principal contract rate x 6/12. Interest expense will increase each period as the carrying amount of the bonds increases. Both B and C are correct