Question 1

Match each of the following current liabilities with its meaning.
-Amounts expected to be paid to repair or replace defective products.

Accepted Answer

A) Account payable 
B) Note payable 
C) Wages payable 
D) Interest payable 
E) Sales taxes payable
F)FICA taxes payable
G)Unemployment taxes payable
H)Unearned sales revenues
I)Estimated warranty liability 
A) Account payable 
B) Note payable 
C) Wages payable 
D) Interest payable 
E) Sales taxes payable
F)FICA taxes payable
G)Unemployment taxes payable
H)Unearned sales revenues
I)Estimated warranty liability I

Question 2

If a business has current assets of $62,000, total assets of $350,000, current liabilities of $31,000, and total liabilities of $125,000, then its current ratio will be

Accepted Answer

A) 0.5. 
B) 2.0. 
C) 2.8. 
D) 3.0. 
A) 0.5. 
B) 2.0. 
C) 2.8. 
D) 3.0. B

Question 3

A company has long-term assets of $2,000, current liabilities of $1,250, and long-term liabilities of $1,500. If the current ratio is 2.5, then current assets must be

Accepted Answer

A) $5,000. 
B) $3,125. 
C) $1,563. 
D) $500. 
A) $5,000. 
B) $3,125. 
C) $1,563. 
D) $500. B

Question 4

A contingent liability must be recognized in the accounting records if it ____________________ and a reasonable estimate of the loss can be made.

Accepted Answer

will proba

Question 5

When a retail company sells products to customers on credit for the amount of the sales price plus the applicable sales tax, the related journal entry includes a debit to accounts receivable, a credit to sales revenue, and a credit to ____________________.

Accepted Answer

The answer of When a retail company sells products to...

Question 6

Gottlieb Pool n' Pub, Inc. sold $25,000 in gift cards during December 2019. The expiration date on these gift cards is December 31, 2020. During 2020, $23,940 of the gift cards were redeemed by customers.
A)Record the sale of the gift cards.
B)Record the redemption of the gift cards.
C)Record the expiration of the remaining gift cards.

Accepted Answer

The answer of Gottlieb Pool n' Pub, Inc. sold $25,000...

Question 7

Georgia's Salon
​
The salon sells $50,000 of gift cards in May 2019. These gift cards may be used anytime before their expiration on May 31, 2020.
-Refer to Georgia's Salon. On May 31, 2020, all but $1,500 of the gift cards had been redeemed for salon services. Which of the following is the correct journal entry to record for the expired gift cards?

Accepted Answer

The answer of Georgia's Salon
​
The salon sells $50,000 of gift...

Question 8

German Auto Parts is a defendant in a multi-million dollar lawsuit that was filed in a prior year. The lawsuit was not previously disclosed in the financial statements or accompanying footnotes, as the company has vigorously defended its position and its attorneys initially indicated that the claim was not valid. During the current year, however, the facts and circumstances have changed such that the likelihood of a loss approximating $5 million is now considered reasonably possible. How should the company recognize this lawsuit in its current year financial statements?

Accepted Answer

A) Do nothing, since it was not recognized in previous periods. 
B) Do nothing until the matter is settled or a judgment or verdict is obtained. 
C) Disclose the matter in the footnotes accompanying the financial statements. 
D) Record a contingent liability in the amount of $5 million. 
A) Do nothing, since it was not recognized in previous periods. 
B) Do nothing until the matter is settled or a judgment or verdict is obtained. 
C) Disclose the matter in the footnotes accompanying the financial statements. 
D) Record a contingent liability in the amount of $5 million.

Question 9

Current liabilities require a transfer of assets or performance of services within the longer of ____________________ or one operating cycle.

Accepted Answer

The answer of Current liabilities require a transfer of assets...

Question 10

On August 3, 2019, Grace Electric Supply agreed to manufacture and supply 650 electrical control units for a particular customer who deposited $136,500 toward the purchase price upon signing the one-year purchase agreement, which set the selling price of each control unit at $1,050. In December 2019, 125 units were delivered to the customer and the remaining units were delivered in January 2020. The customer pays in cash upon delivery for any units not covered by the deposit.
A)Record the journal entry to record the receipt of the customer deposit during 2019.
B)Record the journal entry for the delivery of 125 units to the customer in 2019. How would the customer's deposit be reported in the financial statements at the end of 2019?
C)Record the entry for the delivery of the remaining units to the customer in 2020.

Accepted Answer

The answer of On August 3, 2019, Grace Electric Supply...

Question 11

Employers withhold taxes from their employees' gross pay and later pay these amounts withheld to the taxing authority.

Accepted Answer

A) True 
 B)False

Question 12

List several employee withholdings that impact an employee's net pay. Describe the types of payroll taxes that an employer might be required to pay.

Accepted Answer

Employee withholdings include a variety

Question 13

____________________ are commitments that represent probable future sacrifices of economic benefits.

Accepted Answer

The answer of ____________________ are commitments that represent probable future...

Question 14

When accrual basis accounting matches an expense to a period before it is actually paid, an adjusting entry is necessary to record the accrued expense and corresponding liability.

Accepted Answer

A) True 
 B)False

Question 15

The operating cash flow ratio is computed by dividing cash flows from operating activities by ____________.

Accepted Answer

The answer of The operating cash flow ratio is computed...

Question 16

Match each of the following current liabilities with its meaning.
-Amounts collected from customers in advance.

Accepted Answer

A) Account payable 
B) Note payable 
C) Wages payable 
D) Interest payable 
E) Sales taxes payable
F)FICA taxes payable
G)Unemployment taxes payable
H)Unearned sales revenues
I)Estimated warranty liability 
A) Account payable 
B) Note payable 
C) Wages payable 
D) Interest payable 
E) Sales taxes payable
F)FICA taxes payable
G)Unemployment taxes payable
H)Unearned sales revenues
I)Estimated warranty liability

Question 17

The operating cash flow ratio is calculated by dividing current assets by cash flows from operating activities.

Accepted Answer

A) True 
 B)False

Question 18

A current liability includes obligations which must be repaid

Accepted Answer

A) within one year. 
B) within one year or within the operating cycle, whichever is shorter. 
C) within one year or within the operating cycle, whichever is longer. 
D) by the end of the operating cycle. 
A) within one year. 
B) within one year or within the operating cycle, whichever is shorter. 
C) within one year or within the operating cycle, whichever is longer. 
D) by the end of the operating cycle.

Question 19

Which of the following statements regarding liabilities is true?

Accepted Answer

A) Liabilities must be legally enforceable to a known recipient. 
B) Liabilities arise from past activities that require some future sacrifice of economic benefits. 
C) The accounting principles followed in the U.S. require that current liabilities be listed in order of decreasing amounts on the balance sheet. 
D) The accounting principles followed in the U.S. differ substantially from those of other countries, especially with respect to current liabilities. 
A) Liabilities must be legally enforceable to a known recipient. 
B) Liabilities arise from past activities that require some future sacrifice of economic benefits. 
C) The accounting principles followed in the U.S. require that current liabilities be listed in order of decreasing amounts on the balance sheet. 
D) The accounting principles followed in the U.S. differ substantially from those of other countries, especially with respect to current liabilities.

Question 20

A manufacturing company's weekly payroll is $80,000 for a 5-day work week beginning each Monday and ending each Friday. The last time salaries and wages were recorded was Friday, December 26. What adjustment is needed on December 31, the last day of the company's fiscal period?

Accepted Answer

A) Increase wages expense by $48,000. 
B) Decrease wages payable by $48,000. 
C) Decrease cash by $48,000. 
D) No adjustment is necessary since the next payday will not occur until the following year. 
A) Increase wages expense by $48,000. 
B) Decrease wages payable by $48,000. 
C) Decrease cash by $48,000. 
D) No adjustment is necessary since the next payday will not occur until the following year.

Match each of the following current liabilities with its meaning. -Amounts expected to be paid to repair or replace defective products.

If a business has current assets of $62,000, total assets of $350,000, current liabilities of $31,000, and total liabilities of $125,000, then its current ratio will be

A company has long-term assets of $2,000, current liabilities of $1,250, and long-term liabilities of $1,500. If the current ratio is 2.5, then current assets must be

A contingent liability must be recognized in the accounting records if it ____________________ and a reasonable estimate of the loss can be made.

When a retail company sells products to customers on credit for the amount of the sales price plus the applicable sales tax, the related journal entry includes a debit to accounts receivable, a credit to sales revenue, and a credit to ____________________.

Current liabilities require a transfer of assets or performance of services within the longer of ____________________ or one operating cycle.

Employers withhold taxes from their employees' gross pay and later pay these amounts withheld to the taxing authority.

List several employee withholdings that impact an employee's net pay. Describe the types of payroll taxes that an employer might be required to pay.

____________________ are commitments that represent probable future sacrifices of economic benefits.

When accrual basis accounting matches an expense to a period before it is actually paid, an adjusting entry is necessary to record the accrued expense and corresponding liability.

The operating cash flow ratio is computed by dividing cash flows from operating activities by ____________.

Match each of the following current liabilities with its meaning. -Amounts collected from customers in advance.

The operating cash flow ratio is calculated by dividing current assets by cash flows from operating activities.

A current liability includes obligations which must be repaid

Which of the following statements regarding liabilities is true?

A manufacturing company's weekly payroll is $80,000 for a 5-day work week beginning each Monday and ending each Friday. The last time salaries and wages were recorded was Friday, December 26. What adjustment is needed on December 31, the last day of the company's fiscal period?

Accounting and The Financial Statements

The Accounting Information System

Accrual Accounting

Internal Control And Cash

Sales And Receivables

Cost Of Goods Sold and Inventory

Operating Assets

Long Term Liabilities

Stockholders Apos Equity

The Statement Of Cash Flows

Financial Statement Analysis

Finance and Stock Market Equilibrium

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Exam 8: Current and Contingent Liabilities

Match each of the following current liabilities with its meaning. -Amounts expected to be paid to repair or replace defective products.

If a business has current assets of $62,000, total assets of $350,000, current liabilities of $31,000, and total liabilities of $125,000, then its current ratio will be

A company has long-term assets of $2,000, current liabilities of $1,250, and long-term liabilities of $1,500. If the current ratio is 2.5, then current assets must be

A contingent liability must be recognized in the accounting records if it ____________________ and a reasonable estimate of the loss can be made.

When a retail company sells products to customers on credit for the amount of the sales price plus the applicable sales tax, the related journal entry includes a debit to accounts receivable, a credit to sales revenue, and a credit to ____________________.

Current liabilities require a transfer of assets or performance of services within the longer of ____________________ or one operating cycle.

Employers withhold taxes from their employees' gross pay and later pay these amounts withheld to the taxing authority.

List several employee withholdings that impact an employee's net pay. Describe the types of payroll taxes that an employer might be required to pay.

____________________ are commitments that represent probable future sacrifices of economic benefits.

When accrual basis accounting matches an expense to a period before it is actually paid, an adjusting entry is necessary to record the accrued expense and corresponding liability.

The operating cash flow ratio is computed by dividing cash flows from operating activities by ____________.

Match each of the following current liabilities with its meaning. -Amounts collected from customers in advance.

The operating cash flow ratio is calculated by dividing current assets by cash flows from operating activities.

A current liability includes obligations which must be repaid

Which of the following statements regarding liabilities is true?

A manufacturing company's weekly payroll is $80,000 for a 5-day work week beginning each Monday and ending each Friday. The last time salaries and wages were recorded was Friday, December 26. What adjustment is needed on December 31, the last day of the company's fiscal period?

Accounting and The Financial Statements

The Accounting Information System

Accrual Accounting

Internal Control And Cash

Sales And Receivables

Cost Of Goods Sold and Inventory

Operating Assets

Long Term Liabilities

Stockholders Apos Equity

The Statement Of Cash Flows

Financial Statement Analysis

Finance and Stock Market Equilibrium

Filters