Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

Dividends Payable is an example of a(n)

Accepted Answer

A)  contingent liability. 
B)  definitely determinable liability. 
C)  estimated liability. 
D)  long-term liability. 
A)  contingent liability. 
B)  definitely determinable liability. 
C)  estimated liability. 
D)  long-term liability.

Question 3

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

Accepted Answer

A)  Mortgage payable 
B)  Taxes payable 
C)  Ten-year notes payable 
D)  Bonds payable 
A)  Mortgage payable 
B)  Taxes payable 
C)  Ten-year notes payable 
D)  Bonds payable

Question 4

All factors in a future value table must be greater than or equal to 1.000.

Accepted Answer

A) True 
 B)False

Question 5

Calculate answers to the following questions using future value and/or present value tables.Round amounts to the nearest dollar.
a.What is the present value of receiving $1,000 at the end of each year for six years,assuming 7 percent interest compounded annually?
b.What amount must be deposited at the bank today to grow to $300 in five years,assuming 14 percent interest compounded semiannually?

Accepted Answer

a.$4,767 [($1,000 *

Question 6

Gross earnings minus deductions equals take-home pay.

Accepted Answer

A) True 
 B)False

Question 7

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

Accepted Answer

A)  debit to Salaries Payable for the net amount. 
B)  credit to State Unemployment Tax Payable. 
C)  debit to Salaries Expense for the amount paid to the employees. 
D)  debit to Salaries Expense for the gross payroll. 
A)  debit to Salaries Payable for the net amount. 
B)  credit to State Unemployment Tax Payable. 
C)  debit to Salaries Expense for the amount paid to the employees. 
D)  debit to Salaries Expense for the gross payroll.

Question 8

Compound interest is computed quarterly on $700 for seven years at 12 percent annual interest.The future value table is used by multiplying the $700 by which factor?

Accepted Answer

A)  28 periods at 3 percent 
B)  7 periods at 3 percent 
C)  7 periods at 12 percent 
D)  28 periods at 7 percent 
A)  28 periods at 3 percent 
B)  7 periods at 3 percent 
C)  7 periods at 12 percent 
D)  28 periods at 7 percent

Question 9

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

Accepted Answer

A) True 
 B)False

Question 10

Kahn Company had cash sales of $60,000 for the month of June.Sales are subject to a 4 1/2 percent sales tax and a 6 percent excise tax.In the journal provided,prepare a compound entry without explanation to record Kahn's sales and related sales and excise taxes for the month.

Accepted Answer

The answer of Kahn Company had cash sales of $60,000...

Question 11

If an accrued liability for salaries is not recorded,income for the following period will be understated.

Accepted Answer

A) True 
 B)False

Question 12

A liability for dividends exists only when the board of directors declares them.

Accepted Answer

A) True 
 B)False

Question 13

When a company discounts a note receivable at the bank,it has a contingent liability.

Accepted Answer

A) True 
 B)False

Question 14

Use this information to answer the following question.   What amount must be deposited today at a 12% interest rate so that $1,200 may be withdrawn at the end of each year for three years?

Accepted Answer

A)  $3,600.00 
B)  $3,850.28 
C)  $3,148.80 
D)  $3,366.00 
A)  $3,600.00 
B)  $3,850.28 
C)  $3,148.80 
D)  $3,366.00

Question 15

Current liabilities are debts that are expected to be satisfied within

Accepted Answer

A)  one year or the normal operating cycle,whichever is shorter. 
B)  one year or the normal operating cycle,whichever is longer. 
C)  one year. 
D)  the normal operating cycle. 
A)  one year or the normal operating cycle,whichever is shorter. 
B)  one year or the normal operating cycle,whichever is longer. 
C)  one year. 
D)  the normal operating cycle.

Question 16

The owner of an amusement park is considering installing a new ride.The ride would cost $20,000,produce a net cash flow of $2,500 annually,and last for nine years.
a.Assuming an interest rate of 10 percent,what is the present value of the net cash flows expected from the ride? Use future value and/or present value tables in calculating your answer.Round amounts to the nearest dollar.
b.Should the ride be purchased?

Accepted Answer

a.$14,398 [($2,500 *

Question 17

Which of the following is an example of a commitment?

Accepted Answer

A)  Lease 
B)  Incomes taxes payable 
C)  Sales taxes payable 
D)  Dividend payable 
A)  Lease 
B)  Incomes taxes payable 
C)  Sales taxes payable 
D)  Dividend payable

Question 18

Which of the following descriptions would not fit the definition of a liability?

Accepted Answer

A)  Obligation to deliver services already paid for 
B)  Result of past transaction 
C)  Future obligation for future salary payments 
D)  Present obligation for future payment 
A)  Obligation to deliver services already paid for 
B)  Result of past transaction 
C)  Future obligation for future salary payments 
D)  Present obligation for future payment

Question 19

For notes payable whose interest is stated separately,the adjusting entry would consist of a debit to Interest Payable and a credit to Interest Expense.

Accepted Answer

A) True 
 B)False

Question 20

Prepare journal entries without explanations for the following transactions involving notes payable for Marion Company,whose fiscal year ends September 30.

Accepted Answer

The answer of Prepare journal entries without explanations for the...

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

Dividends Payable is an example of a(n)

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

All factors in a future value table must be greater than or equal to 1.000.

Gross earnings minus deductions equals take-home pay.

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

Compound interest is computed quarterly on $700 for seven years at 12 percent annual interest.The future value table is used by multiplying the $700 by which factor?

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

Kahn Company had cash sales of $60,000 for the month of June.Sales are subject to a 4 1/2 percent sales tax and a 6 percent excise tax.In the journal provided,prepare a compound entry without explanation to record Kahn's sales and related sales and excise taxes for the month.

If an accrued liability for salaries is not recorded,income for the following period will be understated.

A liability for dividends exists only when the board of directors declares them.

When a company discounts a note receivable at the bank,it has a contingent liability.

Use this information to answer the following question. What amount must be deposited today at a 12% interest rate so that $1,200 may be withdrawn at the end of each year for three years?

Current liabilities are debts that are expected to be satisfied within

Which of the following is an example of a commitment?

Which of the following descriptions would not fit the definition of a liability?

For notes payable whose interest is stated separately,the adjusting entry would consist of a debit to Interest Payable and a credit to Interest Expense.

Prepare journal entries without explanations for the following transactions involving notes payable for Marion Company,whose fiscal year ends September 30.

Uses of Accounting Information and the Financial Statements

Analyzing Business Transactions

Measuring Business Income

Supplement - Closing Entries and the Work Sheet

Financial Reporting and Analysis

The Operating Cycle and Merchandising Operations

Inventories

Cash and Receivables

Long Term Assets

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Performance Measurement

Investments

Filters

Exam 9: Current Liabilities and Fair Value Accounting

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

Dividends Payable is an example of a(n)

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

All factors in a future value table must be greater than or equal to 1.000.

Gross earnings minus deductions equals take-home pay.

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

Compound interest is computed quarterly on $700 for seven years at 12 percent annual interest.The future value table is used by multiplying the $700 by which factor?

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

Kahn Company had cash sales of $60,000 for the month of June.Sales are subject to a 4 1/2 percent sales tax and a 6 percent excise tax.In the journal provided,prepare a compound entry without explanation to record Kahn's sales and related sales and excise taxes for the month.

If an accrued liability for salaries is not recorded,income for the following period will be understated.

A liability for dividends exists only when the board of directors declares them.

When a company discounts a note receivable at the bank,it has a contingent liability.

Use this information to answer the following question. What amount must be deposited today at a 12% interest rate so that $1,200 may be withdrawn at the end of each year for three years?

Current liabilities are debts that are expected to be satisfied within

Which of the following is an example of a commitment?

Which of the following descriptions would not fit the definition of a liability?

For notes payable whose interest is stated separately,the adjusting entry would consist of a debit to Interest Payable and a credit to Interest Expense.

Prepare journal entries without explanations for the following transactions involving notes payable for Marion Company,whose fiscal year ends September 30.

Uses of Accounting Information and the Financial Statements

Analyzing Business Transactions

Measuring Business Income

Supplement - Closing Entries and the Work Sheet

Financial Reporting and Analysis

The Operating Cycle and Merchandising Operations

Inventories

Cash and Receivables

Long Term Assets

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Performance Measurement

Investments

Filters