Principles of Accounting I Module 11 Quiz Module 11 - Chapter 10

Payroll taxes are based on the employee's net pay.

• True

• False

When exchanging equipment, if the trade-in allowance is greater than the book value a loss results.

• True

• False

Federal unemployment taxes are paid by the employer and the employee.

• True

• False

Medicare taxes are paid by both the employee and the employer.

• True

• False

The difference between the balance in a fixed asset account and its related accumulated depreciation account is the asset's book value.

• True

• False

Revising depreciation estimates affects the amounts of depreciation expense recorded in past periods

• True

• False

For proper matching of revenues and expenses, the estimated cost of fringe benefits must be recognized as an expense of the period during which the employee earns the benefits.

• True

• False

The journal entry to record the cost of warranty repairs that were incurred during the current period, but related to sales made in prior years, includes a debit to Warranty Expense.

• True

• False

An installment note is a debt that requires the borrower to make equal periodic payments to the lender for the term of the note.

• True

• False

Quick assets include

• cash, cash equivalents, receivables, prepaid expenses, and inventory

• cash, cash equivalents, receivables, and prepaid expenses

• cash, cash equivalents, receivables, and inventory

• cash, cash equivalents, and receivables