Exam 11: Current Liabilities and Fair Value Accounting

Use this information to answer the following question. If an accumulation of $16,000 is desired at the end of three years,what amount must be deposited at the end of each of the three years,assuming an APR of 12 percent?

All of the following can be employee payroll withholdings except

Identify and briefly discuss the three approaches for determining fair value identified by the FASB.

Use this information to answer the following question. Panadora Company has the following information for the pay period of January 1-15,2014.Payment occurs on January 20. Salaries Payable would be recorded for

An estimated liability is not a definite obligation of the firm because the amount cannot be definitely determined.

Use this information to answer the following question. Panadora Company has the following information for the pay period of January 1-15,2014.Payment occurs on January 20. The entry to record the payroll would include a

Product warranties are an expense of the period in which the product is sold.

Under what circumstances is a contingent liability reflected in the accounting records as though an actual liability exists?

Vacation pay is charged properly as an expense in the month in which the employee takes a vacation.

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

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

A contingent liability eventually becomes either a true liability or no liability at all.

Interest on a promissory note is recognized when the note is issued.

Commercial paper normally is issued by companies with poor credit ratings.

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?

Hilda wishes to deposit an amount into her savings account that will enable her to withdraw $1,600 per year for the next four years.She should deposit an amount equal to $1,600 multiplied by the

The current portion of long-term debt is classified as a current liability only if it is due within the next year and is to be paid from current assets.

Which of the following is an example of a commitment?

Because accounting measures should be verifiable,liabilities should not be estimated.

A contingent liability is a liability that may materialize in the future because of something that happened in the past.