Thomson Co. has just signed a new contract that will bring $5,000,000 of revenue into the company over the next year. If Johnson discloses information about the contract in the notes to the financial statements, they will be following the principle of:

		consistency
		conservatism
		full disclosure
		materiality

Finch & Sons has used the LIFO method to account for inventory in the past, but has decided to change to the FIFO method because the change would increase company net income, making the company more attractive to potential inventors. Finch & Sons has violated the principle of:

		consistency
		conservatism
		full disclosure
		materiality

A debit balance in the account 'Allowance for Uncollectible Accounts' indicates that the company has had to close a smaller dollar amount of customer accounts for nonpayment than they had previously estimated (i.e., the amount of uncollectible accounts had been overestimated).

		True
		False

Consider the following information for questions 16 and 17: The Allowance for Uncollectible Accounts has a credit balance of $4,000 prior to the end-of-month adjustment. Sales on credit for the month were $500,000. Past experience indicates that 4 percent of the months credit sales will become uncollectible. Alternatively, an aging of Accounts Receivable accounts shows an estimated total of all uncollectible accounts receivable to be $26,000.

16. Using the aging method, the Allowance for Uncollectible Accounts should be credited for:

		$20,000.
		$24,000.
		$16,000.
		$22,000.

Consider the following information for questions 16 and 17: The Allowance for Uncollectible Accounts has a credit balance of $4,000 prior to the end-of-month adjustment. Sales on credit for the month were $500,000. Past experience indicates that 4 percent of the months credit sales will become uncollectible. Alternatively, an aging of Accounts Receivable accounts shows an estimated total of all uncollectible accounts receivable to be $26,000.

Using the percentage of credit sales method, the Allowance for Uncollectible Accounts should be credited for:

		$24,000.
		$22,000.
		$20,000.
		$16,000.