1. Which of the following activities will not reported in the statement of cash flows? A) Operating activities B) Investing activities C) Marketing activities D) Financing activities 2. The sequence of accounting procedures used to record, classify and summarize accounting information is called the A) accounting period B) accounting cycle. C) accrual accounting. D) double entry bookkeeping. 3. When an account is written off using the allowance method, accounts receivable A) is unchanged and the allowance for impairment increases. B) increases and the allowance for impairment increases. C) decreases and the allowance for impairment increases. D) decreases and the allowance for impairment decreases. 4. The accounts receivable turnover rate for Fairbanks Corporation is 8, and for Pickford Company is 10. These statistics indicate that A) Pickford collects its accounts receivable within 10 days on average while Fairbanks collects its accounts receivable in 8 days on average. B) Pickford writes off as uncollectible a greater percentage of its accounts receivable than does Fairbanks Company, C) Pickford collects its accounts receivable faster than does Fairbanks Company. D) Pickford makes on average 10 credit sales annually to each of its customers, while Fairbanks makes 8 credit sales to each customer. 5. In a perpetual inventory system, the flow of inventory cost is A) only through the statement of financial position and not the income statement. B) only through the income statement and not the statement of financial position C) first through the income statement, then through the statement of financial position. D) first through the statement of financial position, then through the income statement 6. If bonds are issued at a premium, the stated interest rate is A) higher than the market rate of interest. B) lower than the market rate of interest. C) too low to attract investors. D) adjusted to a higher rate of interest 7. The term deficit is used to refer to a debit balance in which of the following accounts of a corporation? A) Treasury Shares B) Retained Earnings C) Organizational Expenses D) Ordinary Shares 8. Dylan Corporation issues for cash $2,000,000 of 8%, 15-year bonds, interest payable annually, at a time when the market rate of interest is 9%. The straight-line method is adopted for the amortization of bond discount or premium. Which of the following statements is true? A) The carrying amount decreases from its amount at issuance date to $2,000,000 at maturity B) The amount of annual interest expense decreases as the bonds approach maturity. C) The amount of annual interest paid to bondholders remains the same over the life of the bonds. D) The amount of annual interest paid to bondholders increases over the 15-year life of the bonds. 9. If $2,000,000 principal amount of 10% bonds are issued at $97, cash received from the issue of bonds amounts to A) $200,000 B) S1,000,000. C) $1,100,000. D) $1,940,000. 10. Franklin Corporation issues $50,000, 10%, 5-year bonds on January 1, 2018, for $52,100. Interest is paid semiannually on January 1 and July 1. If Franklin uses the straight-line method of amortization of bond discount or premium, the amount of bond interest expense to be recognized on July 1, 2018 is A) $2,290 B) S2,500 C) $2,710 D) S10,290