1) which of the following statements is true about u. s. rule?
a. it's never used by banks
b. it allows borrowers to receive interest credit
c. it's hardly used today
d. it's used by only banks

2) darlene ramirez bought a home for $140,000. she put 20% down with a mortgage rate of 7.5% for 25
years. what are her yearly payments?
a. $12,415.20
b. $1,776.00
c. $9,329.61
d. $9,932.16

3) jay corporation has earned $175,900 after tax. the accountant calculated the return on equity as
12.5%. jay corporation's stockholders' equity to the nearest dollar is
a. $140,720,000.
b. $1,407,200.
c. $140,720.
d. $14,720

4) the acid test ratio does not include
a. inventory.
b. cash.
c. accounts receivable.
d. supplies.

5) which one of the following is not used to calculate net sales?
a. purchases
b. sales returns and allowance
c. gross sales
d. sales discount

6) use the following data to calculate the cost of merchandise sold:
sales: $80,000
beginning inventory: $5,000
purchases: $21,800
purchase discounts: $790
ending inventory: $5,100
a. $21,650
b. $20,190
c. $21,560
d. $20,910

7) if a car is depreciated in four years, what is the rate of depreciation using twice the straight-line rate?
a. 25%
b. 75%
c. 100%
d. 50%

8) which one of the following methods is not based on the passage of time?
a. declining-balance method
b. none of these
c. units-of-production method
d. straight-line method

9) depreciation expense is located on the
a. balance sheet.
b. income statement.
c. the accounts receivable documention.
d. the accounts payable documentation.

10) a new piece of equipment costs $18,000 with a residual value of $600 and an estimated useful life of
five years. assuming twice the straight-line rate, the book value at the end of year 2 using the decliningbalance
method is
a. $6,480.
b. $11,520.
c. $18,000.
d. $7,200.

11) depreciation expense in the declining-balance method is calculated by the depreciation rate
a. divided by book value at beginning of year.
b. multiplied by accumulated depreciation at year end.
c. plus book value at end of year.
d. multiplied by book value at beginning of year.