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True or False? If the useful life of an asset is 5 years, the straight-line rate...

True or False? If the useful life of an asset is 5 years, the straight-line rate is 20% per year.

True or False? The balance in Allowance for Doubtful Accounts at the end of a period is reported on the income statement as an operating expense.

True or False? Internal controls are the policies and procedures adopted by management to safeguard its assets, process information accurately, and ensure compliance with applicable laws.

True of False? The maturity value of a 12%, 60-day note for $1,000 is $120.

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Answer #1

True. if useful life is 5 years, The Straight line method depreciation rate is 1/5 = 0.2 = 20%

False. The balance in allowance for doubtful debts is reduced from accounts receivables in the balance sheet.

True. Internal controls are the policies and procedures adopted by management to safeguard its assets, process information accurately, and ensure compliance with applicable laws.

False. $120 is the interest portion calculated for the 12%. It is not the maturity value. Maturity value = Principal amount + interest amount.

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