multiple choice

26. If Caterpillar doesn't have enough cash at this moment, how much does it have to borrow in order to pay the invoice on discount? A. 3,920 B. 4,000 C. It depends on the interest rate D. None of the above 27, If we assume an annual interest rage of 6% and a 360-day year. And Caterpillar has to borrow money for the remaining 20 days of the credit period. How much are the savings from taking the discount? A. 6.67 B. 13.07 C. 19.6 D. 66.93 28. The expiration of prepaid expense will A. decrease assets and increase owner's equity. B. decrease assets and decrease owner's equity C. increase one asset and decrease another asset D. decrease assets and increase liabilities 29. The landlord lady received $8,000 from the tenant as the coming four months' rent. After one month, if the landlord lady doesn't adjust the unearned revenue, what is the influence on her financial statement? A. Owner's equity will be overstated. B. Owner's equity will be understated. C. Liabilities will be understated D. Assets will be overstated. 30. Amazon estimated 5% of the total sales on credit wouldn't be received from the customer last year. Amazon recorded the bad debt expense. If next year, 300 were identified as uncollectible and written off. Which account should be credited to write off the bad debt? A. Bad debt expense B. A/R C. Allowance for doubtful accounts D. Sales allowance