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5. When the physical count of Rosanna Company's inventory showed only 54,350 at year-end and the unadjusted balance in Inventory was $4,500, Rosanna will have to make the following entry: a. Cost of Goods Sold... 150 Inventory .... ........... b. Inventory ........ 150 Cost of Goods Sold... c. Income Summary ........... 150 Inventory ......... d. Cost of Goods Sold.......... 4,500 Inventory 4,500 6. A company's choice of an appropriate inventory cost flow assumption (FIFO, LIFO, etc.) is made by a. the external auditors. b. the SEC. c. the internal auditors. d. company management. 7. A company sells an asset, which originally cost $360,000, for $120,000 on December 31, 2019. The Accumulated Depreciation account had a balance of $145,000 on the date of sale. The company should recognize a a. $240,000 loss on disposal. b. $95,000 gain on disposal. c. $95.000 loss on disposal. d. $60,000 loss on disposal. - 8 Randy Company lends Luann Inc. $10,000 on April 1, accepting a 4-month, 6% interest note. What journal entry should be made by Randy to record Luann's repayment of the loan? a. Note Receivable ............. 10,000 Cash ... 10,000 b. Cash... 10,200 Note Receivable ............... 10,000 Interest Revenue 200 c. Cash... 10,000 Note Receivable ......... 10,000 d. Cash 10,600 Note Receivable ... 10,000 Interest Revenue ... 600 Overstating ending inventory will overstate all of the following except a. assets. b. cost of goods sold. c. net income. d. stockholders' equity

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