True or false:

1.Using the allowance method of accounting for uncollectible receivables requires an estimate of the amount of receivables that will not be collected.

2. When a company receives payment from a customer whose account was previously written off, the customers account should be reinstated.

3. Accepting credit cards through a large bank, rather than offering credit directly to customers can help a business reduce its costs.

4. When a customers account, previously written off as uncollectible, is reinstated, the net realizable value of Accounts Receivables increases.

5. The specific identification inventory method is not practical for companies that sell many low-priced, high turnover items.

6. The inventory cost flow method a company chooses affects both the income statement and the balance sheet.

7. A companys gross margin reported on the income statement is not affected by the inventory cost flow method it uses.

8. A line of credit typically has an interest rate that is fixed (constant) for the length of the agreement

9. Vacation pay and sick leave are examples of contingent liabilities that a company generally should recognize on its financial statements.

10. For a long-term note payable, repaying a portion of principal along with interest payments is called loan amortization.

11. If a company determines that the likelihood of a future obligation arising from a contingent liability is possible but cannot estimate a cost, the company must record a liability on its balance sheet statement

12. If a companys operating cycle is 90 days long, the company would use a period of one year to identify current assets and liabilities

13. Interest and notes receivable are reported on the balance sheet in the order of liquidity.