Question 1

The effective-interest method of amortization of bond premiums and discounts is considered superior to the straight-line method because it results in a(n)

Accepted Answer

A) interest rate that is close to the market interest rate. 
B) uniform rate of interest. 
C) more variable interest rate. 
D) interest rate that increases or decreases slightly over time. 
A) interest rate that is close to the market interest rate. 
B) uniform rate of interest. 
C) more variable interest rate. 
D) interest rate that increases or decreases slightly over time.

Question 2

Sales taxes collected by a retailer from a customer are expenses

Accepted Answer

A) of the retailer. 
B) of the customers. 
C) of the government. 
D) that are not recognized by the retailer until they are submitted to the government. 
A) of the retailer. 
B) of the customers. 
C) of the government. 
D) that are not recognized by the retailer until they are submitted to the government.

Question 3

Liabilities are classified on the balance sheet as current or

Accepted Answer

A) deferred. 
B) unearned. 
C) long-term. 
D) accrued. 
A) deferred. 
B) unearned. 
C) long-term. 
D) accrued.

Question 4

If the market rate of interest at the date of issuance of a bond is greater than the stated interest rate, the bond will be issued at a premium.

Accepted Answer

A) True 
 B)False

Question 5

Molina Corporation issues 5,000, 10-year, 8%, $1,000 bonds dated January 1, 2020, at 103.The journal entry to record the issuance will show a

Accepted Answer

A) debit to Cash of $5,000,000. 
B) debit to Premium on Bonds Payable for $150,000. 
C) credit to Bonds Payable for $5,000,000. 
D) credit to Cash for $5,150,000. 
A) debit to Cash of $5,000,000. 
B) debit to Premium on Bonds Payable for $150,000. 
C) credit to Bonds Payable for $5,000,000. 
D) credit to Cash for $5,150,000.

Question 6

The sale of bonds above face value

Accepted Answer

A) is a rare occurrence. 
B) will cause the total cost of borrowing to be less than the bond interest paid. 
C) will cause the total cost of borrowing to be more than the bond interest paid. 
D) will have no net effect on interest expense by the time the bonds mature. 
A) is a rare occurrence. 
B) will cause the total cost of borrowing to be less than the bond interest paid. 
C) will cause the total cost of borrowing to be more than the bond interest paid. 
D) will have no net effect on interest expense by the time the bonds mature.

The effective-interest method of amortization of bond premiums and discounts is considered superior to the straight-line method because it results in a(n)

Sales taxes collected by a retailer from a customer are expenses

Liabilities are classified on the balance sheet as current or

If the market rate of interest at the date of issuance of a bond is greater than the stated interest rate, the bond will be issued at a premium.

Molina Corporation issues 5,000, 10-year, 8%, $1,000 bonds dated January 1, 2020, at 103.The journal entry to record the issuance will show a

The sale of bonds above face value

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments in Debt and Equity Securities

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Exam 10: Reporting and Analyzing Liabilities

The effective-interest method of amortization of bond premiums and discounts is considered superior to the straight-line method because it results in a(n)

Sales taxes collected by a retailer from a customer are expenses

Liabilities are classified on the balance sheet as current or

If the market rate of interest at the date of issuance of a bond is greater than the stated interest rate, the bond will be issued at a premium.

Molina Corporation issues 5,000, 10-year, 8%, $1,000 bonds dated January 1, 2020, at 103.The journal entry to record the issuance will show a

The sale of bonds above face value

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments in Debt and Equity Securities

Filters