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

An obligation that involves an existing condition for which the outcome is not known with certainty and depends on some event that will occur in the future is call an) .

(Short Answer)

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Question 121

The liability for a premium offer estimated to be redeemed is not a current liability.

(True/False)

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Question 122

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. The total amount of interest compounded quarterly on a $1,500 note payable for 1 year at 12% is

(Multiple Choice)

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Question 123

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. Approximately how many years will it take for a sum invested at 8% with annual compounding to quadruple?

(Multiple Choice)

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Question 124

If a company borrows money from its bank and the bank deducts the interest in advance, the company would record the amount of the interest deduction as

(Multiple Choice)

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Question 125

Which of the following accounts is not classified as a current liability?

(Multiple Choice)

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Question 126

The present value is the value today of a single amount to be paid or received at a specific date in the future.

(True/False)

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Question 127

A firm is required to estimate a liability for repairs for products sold with a warranty.If the firm's accountants later find that the estimated amount for repairs has been overstated, the correct accounting procedure is to

(Multiple Choice)

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Question 128

Advance ticket sales for a concert next month are a current liability.

(True/False)

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Question 129

A company has $200 in cash, $500 in accounts receivable, and $700 in inventory.If current liabilities are $400, then the current ratio would be

(Multiple Choice)

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Question 130

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. Josh and Sara want to buy a house in 4 years.If the house will cost $180,000, how much must they deposit at the end of every year for the next 4 years at 5% compounded annually in order to buy the house?

(Multiple Choice)

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Question 131

A contingent liability is recorded if it is probable and can be reasonably estimated.

(True/False)

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Question 132

If current assets amount to $150, total assets $350, current liabilities $65, and total liabilities $100, then the current ratio is

(Multiple Choice)

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Question 133

When a bank deducts the interest on a note in advance, the note has been .

(Short Answer)

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Question 134

Terms of 2/10, n30 mean that if the discount is not taken, full payment is due within ___________________________ days.

(Short Answer)

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Question 135

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. For a given single sum invested at 8% for 4 years, how will the future value be affected if the compounding period is changed from annual to quarterly?

(Multiple Choice)

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Question 136

A company has $8,000 in cash, $9,250 in accounts receivable, and $19,500 in inventory.If current liabilities are $14,350, then the quick ratio would be

(Multiple Choice)

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Question 137

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 a company wishes to accumulate $500,000 in 20 years at 5% by making equal yearly deposits into an account, calculation of the deposits is an application of the

(Multiple Choice)

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Question 138

In the statement of cash flows, a decrease in accounts payable would be shown as an increase in the Operating Activities category.

(True/False)

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Question 139

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. The future value of equal semi-annual payments of $500 at 8% compounded semiannually for 4 years is

(Multiple Choice)

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Question 140

Showing 121 - 140 of 140

An obligation that involves an existing condition for which the outcome is not known with certainty and depends on some event that will occur in the future is call an) .

The liability for a premium offer estimated to be redeemed is not a current liability.

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. The total amount of interest compounded quarterly on a $1,500 note payable for 1 year at 12% is

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. Approximately how many years will it take for a sum invested at 8% with annual compounding to quadruple?

If a company borrows money from its bank and the bank deducts the interest in advance, the company would record the amount of the interest deduction as

Which of the following accounts is not classified as a current liability?

The present value is the value today of a single amount to be paid or received at a specific date in the future.

A firm is required to estimate a liability for repairs for products sold with a warranty.If the firm's accountants later find that the estimated amount for repairs has been overstated, the correct accounting procedure is to

Advance ticket sales for a concert next month are a current liability.

A company has $200 in cash, $500 in accounts receivable, and $700 in inventory.If current liabilities are $400, then the current ratio would be

A contingent liability is recorded if it is probable and can be reasonably estimated.

If current assets amount to $150, total assets $350, current liabilities $65, and total liabilities $100, then the current ratio is

When a bank deducts the interest on a note in advance, the note has been .

Terms of 2/10, n30 mean that if the discount is not taken, full payment is due within ___________________________ days.

A company has $8,000 in cash, $9,250 in accounts receivable, and $19,500 in inventory.If current liabilities are $14,350, then the quick ratio would be

In the statement of cash flows, a decrease in accounts payable would be shown as an increase in the Operating Activities category.

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. The future value of equal semi-annual payments of $500 at 8% compounded semiannually for 4 years is

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, Plant, and Equipment, and Intangibles

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International Financial Reporting Standards

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