In computing depreciation, salvage value is
a. the fair market value of a plant asset on the date of acquisition.
b. subtracted from accumulated depreciation to determine the plant asset's depreciable cost.
c. an estimate of a plant asset's value at the end of its useful life.
d. ignored in all the depreciation methods.
Ans: c. an estimate of a plant asset's value at the end of its useful life.
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On October 1, 2015, Frank, Inc. issued a $28,000, 10%, nine-month interest-bearing note. Assume the necessary adjusting entry was made to accrue interest at the end of the fiscal year, December 31, 2015. The entry to record the payment of the note on July 1, 2016 will include a
A. credit to Notes Payable for $30,100 B. credit to Cash for $28,000 C. debit to Interest Expense for $700 D. debit to Notes Payable for $30,100
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