Question 1

A note payable that is due within one year is classified as a current liability.

Accepted Answer

A) True 
 B)False

Question 2

The debt ratio equals total assets divided by total liabilities.

Accepted Answer

A) True 
 B)False

Question 3

If a $15,000,8 percent,20-year bond was issued at 96 on November 1,how much will accrued interest payable be on December 31 if interest payments are made annually?

Accepted Answer

A) $200 
B) $195 
C) $205 
D) $192 
A) $200 
B) $195 
C) $205 
D) $192

Question 4

Benefits are extra compensation that is paid directly to the employee.

Accepted Answer

A) True 
 B)False

Question 5

On August 15,2014,Woods Design signed a $20,000 7% 10-year installment note which requires annual payments of $4,000 plus interest.Woods will classify this loan on the December 31,2014 Balance Sheet as $4,000 current portion of long-term debt and $20,000 long-term debt.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following does NOT have an effect on the amount of federal income tax to be withheld from an employee's pay?

Accepted Answer

A) Age of employee 
B) Marital status of employee 
C) Number of withholding allowances claimed 
D) Gross pay of employee 
A) Age of employee 
B) Marital status of employee 
C) Number of withholding allowances claimed 
D) Gross pay of employee

Question 7

Current liabilities are expected to be settled within:

Accepted Answer

A) 3 months. 
B) 6 months. 
C) 1 year. 
D) more than 1 year. 
A) 3 months. 
B) 6 months. 
C) 1 year. 
D) more than 1 year.

Question 8

The journal entry to record $300,000 of bonds that were issued at 107 would be to:

Accepted Answer

A) debit Cash,$321,000;credit Bonds payable,$321,000. 
B) debit Cash,$321,000;credit Bonds payable,$300,000;credit Premium on bonds payable,$21,000. 
C) debit Cash,$300,000;credit Bonds payable,$300,000. 
D) debit Cash,$300,000;debit Discount on bonds payable,$21,000;credit Bonds payable,$321,000. 
A) debit Cash,$321,000;credit Bonds payable,$321,000. 
B) debit Cash,$321,000;credit Bonds payable,$300,000;credit Premium on bonds payable,$21,000. 
C) debit Cash,$300,000;credit Bonds payable,$300,000. 
D) debit Cash,$300,000;debit Discount on bonds payable,$21,000;credit Bonds payable,$321,000.

Question 9

If the market rate of interest is greater than the bond's stated rate of interest,the bond will be issued at:

Accepted Answer

A) a discount. 
B) par. 
C) a premium. 
D) maturity value. 
A) a discount. 
B) par. 
C) a premium. 
D) maturity value.

Question 10

Payroll is also called employee compensation and can consist of many parts.

Accepted Answer

A) True 
 B)False

Question 11

Bach Instruments had total assets of $560,000;total liabilities of $250,000;and total Stockholders' Equity of $310,000.Bach's debt ratio is:

Accepted Answer

A) 55.4%. 
B) 80.6%. 
C) 44.6%. 
D) 28.7%. 
A) 55.4%. 
B) 80.6%. 
C) 44.6%. 
D) 28.7%.

Question 12

Many salespersons have part of their payroll determined by a percent of sales.These are called:

Accepted Answer

A) salaries. 
B) wages. 
C) bonuses. 
D) commissions. 
A) salaries. 
B) wages. 
C) bonuses. 
D) commissions.

Question 13

Livingston Organization had total assets of $600,000;total liabilities of $175,000;and total Stockholders' Equity of $425,000.Livingston's debt ratio is:

Accepted Answer

A) 17.1%. 
B) 70.8%. 
C) 41.2%. 
D) 29.2%. 
A) 17.1%. 
B) 70.8%. 
C) 41.2%. 
D) 29.2%.

Question 14

Capital leases are most similar to:

Accepted Answer

A) Accounts Payable. 
B) unearned revenue. 
C) mortgage notes. 
D) regular Notes Payable. 
A) Accounts Payable. 
B) unearned revenue. 
C) mortgage notes. 
D) regular Notes Payable.

Question 15

A company may use two payroll accounts as a control for efficiency.

Accepted Answer

A) True 
 B)False

Question 16

Contingent liabilities may be classified as:

Accepted Answer

A) current liabilities only. 
B) long-term liabilities only. 
C) notes in the financial statements only. 
D) either current or long-term liabilities. 
A) current liabilities only. 
B) long-term liabilities only. 
C) notes in the financial statements only. 
D) either current or long-term liabilities.

Question 17

A warranty is an example of a(n):

Accepted Answer

A) contingent liability. 
B) known liability. 
C) estimated liability. 
D) settled liability. 
A) contingent liability. 
B) known liability. 
C) estimated liability. 
D) settled liability.

Question 18

Which of the following statements is TRUE regarding the debt ratio?

Accepted Answer

A) The debt ratio focuses on the total liabilities of an organization. 
B) The debt ratio reveals the percentage of a business' assets financed with liabilities. 
C) The debt ratio is used to analyze a business's ability to pay its current obligations as they come due. 
D) Both A and B are true statements regarding the debt ratio. 
A) The debt ratio focuses on the total liabilities of an organization. 
B) The debt ratio reveals the percentage of a business' assets financed with liabilities. 
C) The debt ratio is used to analyze a business's ability to pay its current obligations as they come due. 
D) Both A and B are true statements regarding the debt ratio.

Question 19

The need to create an estimated warranty liability arises from the ________ principle.

Accepted Answer

A) matching 
B) entity 
C) conservatism 
D) objectivity 
A) matching 
B) entity 
C) conservatism 
D) objectivity

Question 20

Which of the following would be considered a contingent liability?

Accepted Answer

A) Federal income tax payable 
B) Warranties payable 
C) Pending litigation 
D) Salaries payable 
A) Federal income tax payable 
B) Warranties payable 
C) Pending litigation 
D) Salaries payable

A note payable that is due within one year is classified as a current liability.

The debt ratio equals total assets divided by total liabilities.

If a $15,000,8 percent,20-year bond was issued at 96 on November 1,how much will accrued interest payable be on December 31 if interest payments are made annually?

Benefits are extra compensation that is paid directly to the employee.

On August 15,2014,Woods Design signed a $20,000 7% 10-year installment note which requires annual payments of $4,000 plus interest.Woods will classify this loan on the December 31,2014 Balance Sheet as $4,000 current portion of long-term debt and $20,000 long-term debt.

Which of the following does NOT have an effect on the amount of federal income tax to be withheld from an employee's pay?

Current liabilities are expected to be settled within:

The journal entry to record $300,000 of bonds that were issued at 107 would be to:

If the market rate of interest is greater than the bond's stated rate of interest,the bond will be issued at:

Payroll is also called employee compensation and can consist of many parts.

Bach Instruments had total assets of $560,000;total liabilities of $250,000;and total Stockholders' Equity of $310,000.Bach's debt ratio is:

Many salespersons have part of their payroll determined by a percent of sales.These are called:

Livingston Organization had total assets of $600,000;total liabilities of $175,000;and total Stockholders' Equity of $425,000.Livingston's debt ratio is:

Capital leases are most similar to:

A company may use two payroll accounts as a control for efficiency.

Contingent liabilities may be classified as:

A warranty is an example of a(n):

Which of the following statements is TRUE regarding the debt ratio?

The need to create an estimated warranty liability arises from the ________ principle.

Which of the following would be considered a contingent liability?

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Cash and Receivables

Long-Term and Other Assets

Corporations: Paid-In Capital and Retained Earnings

The Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 9: Current Liabilities and Long-Term Debt

A note payable that is due within one year is classified as a current liability.

The debt ratio equals total assets divided by total liabilities.

If a $15,000,8 percent,20-year bond was issued at 96 on November 1,how much will accrued interest payable be on December 31 if interest payments are made annually?

Benefits are extra compensation that is paid directly to the employee.

On August 15,2014,Woods Design signed a $20,000 7% 10-year installment note which requires annual payments of $4,000 plus interest.Woods will classify this loan on the December 31,2014 Balance Sheet as $4,000 current portion of long-term debt and $20,000 long-term debt.

Which of the following does NOT have an effect on the amount of federal income tax to be withheld from an employee's pay?

Current liabilities are expected to be settled within:

The journal entry to record $300,000 of bonds that were issued at 107 would be to:

If the market rate of interest is greater than the bond's stated rate of interest,the bond will be issued at:

Payroll is also called employee compensation and can consist of many parts.

Bach Instruments had total assets of $560,000;total liabilities of $250,000;and total Stockholders' Equity of $310,000.Bach's debt ratio is:

Many salespersons have part of their payroll determined by a percent of sales.These are called:

Livingston Organization had total assets of $600,000;total liabilities of $175,000;and total Stockholders' Equity of $425,000.Livingston's debt ratio is:

Capital leases are most similar to:

A company may use two payroll accounts as a control for efficiency.

Contingent liabilities may be classified as:

A warranty is an example of a(n):

Which of the following statements is TRUE regarding the debt ratio?

The need to create an estimated warranty liability arises from the ________ principle.

Which of the following would be considered a contingent liability?

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Cash and Receivables

Long-Term and Other Assets

Corporations: Paid-In Capital and Retained Earnings

The Statement of Cash Flows

Financial Statement Analysis

Filters