True and false I. True or False (10 points, I point each) Answer 1. Accounting e

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True and false

I. True or False (10 points, I point each) Answer 1. Accounting equation can be expressed as Assets Liabilities + Owner's Equity 2. In an inflation situation, LIFO method yields a lower net income. 3. The allowance for doubtful accounts is an estimate based on past expei of the corporation Using FIFO method to calculate inventory can decrease tax payment. 5. Withdrawals by the owner are a business expense. 6. The difference between the balance of accounts receivable and allowance for doubtful accounts is called net realizable value. 7. The balance sheet shows a company's net income or loss due to earnings activities over a period of time ic data be recorded in a common unit of measurement like RMB and U.S. dollar 9. Cash is the most liquid assets 10. By using the straight-line depreciation method, assets are depreciating at a faster speed in the first several years.

Explanation / Answer

ANSWER -1                 TRUE

2- TRUE

3- TRUE

4- FALSE - IN CASE IF PRIOR PURCHASE IS ON HIGHER SIDE TAX WILL REDUCE.

5-FALSE

6- TRUE -   NET REALIZABLE VALUE MAY INCREASE IF AMOUNT RECD AGAINST DOUBTFUL.

7- FALSE

8-FALSE

9-TRUE

10- FALSE - DEPEND ON RATE OF DEPRECIATION - IN STRAIGHT LINE - EQUAL THRU OUT USEFUL LIFE.

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