What does the term "net book value" mean?

1. The beginning balance that the firm uses when it disposes of an asset or liability
2. The ending balance of an asset or liability that is used for tax reporting purposes
3. The ending balance of an asset or liability after deducting the ending balance of its related contra account(s)
4. All of the above
5. None of the above

5 points

QUESTION 15

What is the difference between Bad Debt Expense and Receivable Write-off?

1. Bad Debt Expense reduces Accounts Receivable and Receivable Write-off reduces NI
2. Bad Debt Expense reduces NI and Receivable Write-off raises NI
3. Bad Debt Expense reduces the allowance account and Receivable Write-off does not change it
4. Bad Debt Expense raises the allowance account and Receivable Write-off reduces it
5. There is no difference

5 points

QUESTION 16

Which of the following is an asset?

1. Accounts receivable
2. Allowance for doubtful accounts
3. Accumulated depreciation
4. Patents
5. All of the above

5 points

QUESTION 17

What is the difference between the Income Statement and the Cash Flow Statement?

1. There is no difference. They both show cash coming in and out of the firm.
2. The Income Statement is for a single point in time and the Cash Flow Statement covers a specific period of time
3. The Income Statement shows accrual basis Net Income and the Cash Flow Statement shows why the cash balance on the Balance Sheet changed between two Balance Sheet dates.
4. All of the above
5. None of the above