Exam 11: Current Liabilities and Fair Value Accounting

Use this information to answer the following question. -A deposit of $5,800 made at the end of each year for three years would grow to how much,assuming an APR of 12 percent?

On January 2,2014,Lionel Company issued $40,000 of notes payable,of which $10,000 is due on January 2 for each of the next four years.The proper balance sheet presentation on December 31,2014,is

Fergus Company is considering the purchase of a machine that will save the company $4,000 per year in operating costs for a period of seven years.The most it should pay for the machine is equal to

Payables turnover is measured in number of days.

Kangjon Company allows each employee two weeks' paid vacation after the employee has worked at the company for one year (50 weeks work).On the basis of past experience,management estimates that 80 percent of employees will qualify for vacation pay this year.Assume that the March payroll is $400,000.Compute the vacation pay expense for the month.Show your computation.

Which of the following is not a component of the operating cycle?

If any portion of a long-term debt is to be paid in the next year,that portion should be classified as a current liability.

Only the unused portion of a line of credit is recognized as a liability.

Accrued liabilities often arise as a result of the passage of time.

A company sells merchandise on a deferred payment plan,ultimately receiving $6,000 on the account receivable.On the payment date,the company would

Recording estimated product warranty expense in the year of the sale best follows which of the following accounting principles?

All of the following are classified as definitely determinable liabilities except

To determine the payables turnover,one first calculates the days' payable.

Property Taxes Expense is recorded only in the month it is paid.

Use this information to answer the following question. The transactions below pertain to Dunhill Company,whose fiscal year ends April 30. The entry to record the April 10 transaction (amounts rounded)is:

Which of the following most likely would be classified as a current liability?

If a state unemployment tax is imposed,then the federal unemployment tax is not imposed.

All of the following can be employee payroll withholdings except

The payables turnover is the number of times,on average,that a company pays its accounts payable in an accounting period.

Based on past experience,it should be possible to estimate the amount that a product warranty will cost the company in the future.