Multiple Choice Answers

The process of transferring the cost of natural resources to an expense is termed __________.

a. Depreciation
b. Amortization
c. Depletion
d. Reserve recognition

Conversion cost is the combination of direct labor cost and factory overhead cost.

True
False

Which method of depreciation is used by most companies?

a. Straight-line
b. Units-of-production
c. Declining balance
d. All are used about equally

The due date of a 90-day note dated July 1 is:

a. September 30
b. September 28
c. September 29
d. October 1

On June 5 Apex Co. issued a $60,000, 8%, 120-day note payable to Jones Co. What is the maturity value of the note?

a. $60,160
b. $58,400
c. $61,600
d. $59,840