Please try to explain

Problem 16% 6. For cach of the following, place the letter that corresponds to the best answer in the space provided: For a corporation, interest on bonds differs from dividends on stock in that A. interest is tax deductible for the corporation and dividends are not. B. interest reduces its net income, but dividends do not c. both A and B are correct. D. none of the above is correct. 1. A firm with a current ratio below 1.0 times A. is more likely to be an airline than a retailer. B. has negative working capital. C must have more total liubilities than total assets. D. both A and B are correct. L. all of the above are correct. 7. If a retailer collects on charge sales almost immediately, zero excess days can be evidence of a retailer's power over its suppliers. B. would indicate the retailer's customers are, in cffect, paying its suppliers. C. can indicate the retailer's cash situation is worrisome D both A and B are correct. _8. 2. Goodwill arises when A. one firm pays too much to acquire another firm. B. one firm pays too little to acquire another firm. c. the acquiring firm pays for expected superior future earnings. D. none of the above is correct A high quick ratio could result from a firm's A. inability to collect its accounts receivable. B inability to sell its merchandise inventory. C both A and B are correct. D. none of the above is correct. 9. 3. A firm's Excess Days measurement A. is likely to be negative for a hakery B. will always decline if a firm is able to lower both its DSI and its DPAP. C. cannot be calculated if its days' sales in accounts receivable exceeds 10 days. D. both A and B are correct. E. all of the above are correct. To the accountant, depreciation represents A. allocation of the asset's cost to expense over its expected period of use the decline in the asset's market value during the year, C. the increase in the asset's market value during the year. D. the decline in the asset's market value over the past two years. 10. 4 When firms report depreciation to stockholders, they A. always use the same depreciation method that they use for income taxes. B. usually use the site depreciation method that they use for income taxes. C. directly reduce the equipment account for depreciation on the equipment. D. none of the above is correct. Alim's gross-prolit percentage will decline it, holding other variables constant, A. it must reduce the price at which it sells merchandise to customers. B, the price it pays lo suppliers of merchandise decreases. C. its operating expenses increase. D. its operating expenses decrease. E. both A and Care correct. F. A, B, and are correct. 5. 11 When WorldCom, in error, permanently capitalized fees it paid when its customers used phone lines of another firm, A. it overstated its nct income. B. it understated its expenses. C. it violated the matching concept. D all of the above are correct. In the U.S., research and development costs are generally A. placed on the balance sheet for a period of 2-5 years before being expensed. B. placed on the balance sheet for a period of 2-10 years before being expensed. C. expensed immediately. D. either A or C, depending on the company's accounting preference. 1