All of the following are potential disadvantages of short-term debt EXCEPT
A) short-term debt must be paid back more quickly than long-term debt.
B) uncertainty of interest costs because short-term debt must be replaced often.
C) short-term debt generally has a higher interest cost than long-term debt.
D) a greater risk of illiquidity than long-term debt.
C
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Revenues have a normal credit balance
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Neville Co issued 20-year term bonds at a discount in 20x5. Interest is payable semiannually. Which of the following statements is true, assuming that the effective interest method of amortization is used for the bond discount?
A) Interest expense decreases each six-month interest period. B) Interest expense as a percentage of the bond's book value changes from period to period. C) Interest expense increases each six-month interest period. D) Interest expense remains constant in amount for each interest period.
Umber Company's bank reconciliation for September is presented below. Prepare the necessary adjusting journal entries based on the reconciliation report.UMBER COMPANYBank ReconciliationSeptember 30Bank statement balance$1,350Book balance of cash?$995Add:?Add:??Deposit in transit1,250Proceeds of note?875Bank error275????$2,875??1,870Deduct:?Deduct:??Outstanding checks1,145NSF check plus processing fee?125??Bank service charge?15Reconciled balance$1,730Reconciled balance?$1,730
What will be an ideal response?