FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 9: Current Liabilities, Contingencies, and the Time Value of Money

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 51

True/False

Review LaterAdd Note

Review Later

A note payable due in two years is a current liability.

Correct Answer

verified

Show Answer

Question 52

Multiple Choice

Review LaterAdd Note

Review Later

Which of the following is an example of a contingent liability?

A) A liability for notes payable with interest included in the face amount.
B) The liability for future warranty repairs on computers sold during the current period.
C) A lawsuit pending against a restaurant chain for improper preparation of food.
D) A corporate long-term employment contract with the chief executive officer.

Correct Answer

verified

Show Answer

Question 53

Multiple Choice

Review LaterAdd Note

A cereal company includes one premium coupon in every cereal box.Upon returning 10 such coupons to the company, a customer will be sent a free cereal bowl.In a recent year, the company sold 200,000 boxes of cereal for $1 a box.It is estimated that 20% of the coupons will be returned.If the cereal bowls cost the company $3 each, what amount of liability for premium redemptions must be recorded by the company?

A note payable that is due in six months is a current liability.

To determine whether a lottery winner would prefer to receive the money in a single lump sum immediately or receive an equal amount over a period of years, you would use which type of time value of money calculation?

An annuity is a series of equal payments made at equal intervals in the future.

The solution to this problem requires time value of money calculations.Reference to Tables 9-1 through 9-4 in the text is necessary to complete the calculations. If interest is compounded annually, the total amount of interest on an $18,000 note payable for 4 years at 10% is

International accounting standards require companies to present classified balance sheets with liabilities classified as either current or long term.

The solution to this problem requires time value of money calculations.Reference to Tables 9-1 through 9-4 in the text is necessary to complete the calculations. Kingston inherited $140,000 from an aunt.If Kingston decides not to spend his inheritance but to leave the money in his savings account until he retires in 15 years, how much money will he have assuming an annual interest rate of 8%, compounded semiannually?

A company's weekly payroll amounts to $50,000 and payday for the week is every Friday.Employees work five days per week, Monday through Friday.The appropriate journal entry was recorded at the end of the accounting period, Monday, March 31, 2014.What amount is wages expense for April for the payday, Friday, April, 4, 2014?

Executive, Inc.has a weekly payroll of $10,000 for a 5-day workweek, Monday through Friday.If December 31, the last day of the accounting year, falls on Thursday, Executive would make an adjusting entry that would

On November 1, Greenfield Corporation borrowed $55,000 from a bank and signed a 12%, 90-day note payable in the amount of $55,000.If you assume 360 days in year, the November 30 adjusting entry will be:

Accrued wages is not a current liability.

The interest earned on the principal amount only is referred to as .

Which of the following statements regarding contingencies is true?

If a bank discounts a note, then the borrower needs to only pay the cash received and not the face value of the note.

At December 31, 2014, an amount due on December 31, 2015, would be classified as an) _______________________ liability.

Contingent assets may be disclosed in the notes if probable and reasonably estimable.

Almost all current liabilities appear within the Activities category of the Statement of Cash Flows.

Which of the following statements about current liabilities is true?