Question 1

Payroll liabilities for current employees are:

Accepted Answer

A)  Contingent liabilities. 
B)  Estimated liabilities. 
C)  Can be either current or long-term depending on when workers retire. 
D)  Current liabilities. 
E)  None of these answers is correct. 
A)  Contingent liabilities. 
B)  Estimated liabilities. 
C)  Can be either current or long-term depending on when workers retire. 
D)  Current liabilities. 
E)  None of these answers is correct.

Question 2

Short-term notes payable:

Accepted Answer

A)  Can replace an account payable. 
B)  Usually represent money borrowed from a bank. 
C)  Are usually interest bearing. 
D)  Are recorded as current liabilities. 
E)  All of these answers are correct. 
A)  Can replace an account payable. 
B)  Usually represent money borrowed from a bank. 
C)  Are usually interest bearing. 
D)  Are recorded as current liabilities. 
E)  All of these answers are correct.

Question 3

Explain the concept of interest.

Accepted Answer

Interest represents

Question 4

A company sells its product subject to a warranty that covers the cost of parts and labour for repairs during the six months after sale.Warranty costs are estimated to be 4.5% of sales for parts,and 1.5% of sales for labour.During the month of June,the company performed warranty work and used $8,000 worth of parts and paid $4,000 in wages for labour to do the warranty work.Sales for June amounted to $450,000.
(1)What account should be debited for the $4,000 in labour?
(2)What should be the amount of estimated warranty expense for June?
(3)If the Estimated Warranty Liability account had a $10,000 credit balance on May 31,what should be the account balance as of June 30?

Accepted Answer

(1)Estimated Warranty Liabilit

Question 5

Estimated liabilities include employee health benefits,property taxes,and warranties.

Accepted Answer

A) True 
 B)False

Question 6

The receipt of $6,000 in advance ticket sales would be recorded as:

Accepted Answer

A)  Debit Cash,credit Unearned Revenue. 
B)  Debit Unearned Revenue,credit Sales. 
C)  Debit Sales,credit Unearned Revenue. 
D)  Debit Unearned Revenue,credit Cash. 
E)  Debit Cash,credit Revenue PayablE. 
A)  Debit Cash,credit Unearned Revenue. 
B)  Debit Unearned Revenue,credit Sales. 
C)  Debit Sales,credit Unearned Revenue. 
D)  Debit Unearned Revenue,credit Cash. 
E)  Debit Cash,credit Revenue PayablE.

Question 7

The characteristics of a liability include:

Accepted Answer

A)  Occurrence of a past transaction or event. 
B)  Requirement of future payment of assets or rendering of services. 
C)  A liability can be current or long term. 
D)  Existence of a present obligation. 
E)  All of these answers are correct. 
A)  Occurrence of a past transaction or event. 
B)  Requirement of future payment of assets or rendering of services. 
C)  A liability can be current or long term. 
D)  Existence of a present obligation. 
E)  All of these answers are correct.

Question 8

On November 16,Predator Company borrowed $112,000 from DT Bank.The loan had an interest rate of 10% and was due in 90 days.Predator Company's fiscal year-end is December 31.
Prepare the journal entry to record the payment of the note on Predator's books.

Accepted Answer

The answer of On November 16,Predator Company borrowed $112,000 from...

Question 9

A contingent liability exists when a potential liability that depends on a future event arising out of a past transaction liability is either not probable or it cannot be reliably estimated.

Accepted Answer

A) True 
 B)False

Question 10

A long-term liability can have a current component.

Accepted Answer

A) True 
 B)False

Question 11

Contingent assets should be recognized as soon as they are probable and can be reliably estimated.

Accepted Answer

A) True 
 B)False

Question 12

On November 16,2015,Williams Industrial gave Phillip Co.a 90-day,8%,$80,000 note payable to extend a past due account payable.
Prepare the journal entry for Williams Industrial to record payment of the note on Feb 14,2016.Williams Industrial recorded a December 31st year end adjusting entry.

Accepted Answer

Question 13

Both partnerships and corporations calculate an income tax liability based on their taxable incomes,but proprietorships do not.

Accepted Answer

A) True 
 B)False

Question 14

The accounting for a contingent liability is the same as for a provision.

Accepted Answer

A) True 
 B)False

Question 15

A liability exists because of a past event that creates a future obligation for future sacrifices.

Accepted Answer

A) True 
 B)False

Question 16

A liability is a future payment of assets or services that a company is currently obligated to make as a result of past transactions or events.

Accepted Answer

A) True 
 B)False

Question 17

Provisions must be recorded if:

Accepted Answer

A)  The future event is probable and the amount can be reliably estimated. 
B)  The future event is unlikely. 
C)  The future event is probable,but the amount cannot be estimated. 
D)  The future event is unlikely,but the amount can be reliably estimated. 
E)  All of these answers are correct. 
A)  The future event is probable and the amount can be reliably estimated. 
B)  The future event is unlikely. 
C)  The future event is probable,but the amount cannot be estimated. 
D)  The future event is unlikely,but the amount can be reliably estimated. 
E)  All of these answers are correct.

Question 18

Fees accepted in advance from a client:

Accepted Answer

A)  Are recorded as earned revenues on the income statement. 
B)  Increase income. 
C)  Are recorded as liabilities. 
D)  Do not increase assets. 
E)  None of these answers is correct. 
A)  Are recorded as earned revenues on the income statement. 
B)  Increase income. 
C)  Are recorded as liabilities. 
D)  Do not increase assets. 
E)  None of these answers is correct.

Question 19

The Toronto Raptors received $6 million in season ticket sales.Prior to the beginning of the basketball season,these sales are recorded as a credit to unearned season ticket revenue.

Accepted Answer

A) True 
 B)False

Question 20

On November 16,2015,Kinsmen Sports gave Source for Sports a 120-day,8%,$120,000 note payable to extend a past due account payable.
What amount of interest expense should Source for Sports report for calendar 2015?

Accepted Answer

$1,183.56

Payroll liabilities for current employees are:

Short-term notes payable:

Explain the concept of interest.

Estimated liabilities include employee health benefits,property taxes,and warranties.

The receipt of $6,000 in advance ticket sales would be recorded as:

The characteristics of a liability include:

On November 16,Predator Company borrowed $112,000 from DT Bank.The loan had an interest rate of 10% and was due in 90 days.Predator Company's fiscal year-end is December 31. Prepare the journal entry to record the payment of the note on Predator's books.

A contingent liability exists when a potential liability that depends on a future event arising out of a past transaction liability is either not probable or it cannot be reliably estimated.

A long-term liability can have a current component.

Contingent assets should be recognized as soon as they are probable and can be reliably estimated.

On November 16,2015,Williams Industrial gave Phillip Co.a 90-day,8%,$80,000 note payable to extend a past due account payable. Prepare the journal entry for Williams Industrial to record payment of the note on Feb 14,2016.Williams Industrial recorded a December 31^st year end adjusting entry.

Both partnerships and corporations calculate an income tax liability based on their taxable incomes,but proprietorships do not.

The accounting for a contingent liability is the same as for a provision.

A liability exists because of a past event that creates a future obligation for future sacrifices.

A liability is a future payment of assets or services that a company is currently obligated to make as a result of past transactions or events.

Provisions must be recorded if:

Fees accepted in advance from a client:

The Toronto Raptors received $6 million in season ticket sales.Prior to the beginning of the basketball season,these sales are recorded as a credit to unearned season ticket revenue.

On November 16,2015,Kinsmen Sports gave Source for Sports a 120-day,8%,$120,000 note payable to extend a past due account payable. What amount of interest expense should Source for Sports report for calendar 2015?

Property,plant and Equipment,and Intangibles

Partnerships

Organization and Operation of Corporations

Corporate Reporting: Income,earnings Per Share,and Retained Earnings

Bonds and Long-Term Notes Payable

Accounting for Debt and Share Investments

Reporting and Analyzing Cash Flows

Analyzing Financial Statements

Filters

Exam 11: Current Liabilities

Payroll liabilities for current employees are:

Short-term notes payable:

Explain the concept of interest.

Estimated liabilities include employee health benefits,property taxes,and warranties.

The receipt of $6,000 in advance ticket sales would be recorded as:

The characteristics of a liability include:

On November 16,Predator Company borrowed $112,000 from DT Bank.The loan had an interest rate of 10% and was due in 90 days.Predator Company's fiscal year-end is December 31. Prepare the journal entry to record the payment of the note on Predator's books.

A contingent liability exists when a potential liability that depends on a future event arising out of a past transaction liability is either not probable or it cannot be reliably estimated.

A long-term liability can have a current component.

Contingent assets should be recognized as soon as they are probable and can be reliably estimated.

On November 16,2015,Williams Industrial gave Phillip Co.a 90-day,8%,$80,000 note payable to extend a past due account payable. Prepare the journal entry for Williams Industrial to record payment of the note on Feb 14,2016.Williams Industrial recorded a December 31st year end adjusting entry.

Both partnerships and corporations calculate an income tax liability based on their taxable incomes,but proprietorships do not.

The accounting for a contingent liability is the same as for a provision.

A liability exists because of a past event that creates a future obligation for future sacrifices.

A liability is a future payment of assets or services that a company is currently obligated to make as a result of past transactions or events.

Provisions must be recorded if:

Fees accepted in advance from a client:

The Toronto Raptors received $6 million in season ticket sales.Prior to the beginning of the basketball season,these sales are recorded as a credit to unearned season ticket revenue.

On November 16,2015,Kinsmen Sports gave Source for Sports a 120-day,8%,$120,000 note payable to extend a past due account payable. What amount of interest expense should Source for Sports report for calendar 2015?

Property,plant and Equipment,and Intangibles

Partnerships

Organization and Operation of Corporations

Corporate Reporting: Income,earnings Per Share,and Retained Earnings

Bonds and Long-Term Notes Payable

Accounting for Debt and Share Investments

Reporting and Analyzing Cash Flows

Analyzing Financial Statements

Filters

On November 16,2015,Williams Industrial gave Phillip Co.a 90-day,8%,$80,000 note payable to extend a past due account payable. Prepare the journal entry for Williams Industrial to record payment of the note on Feb 14,2016.Williams Industrial recorded a December 31^st year end adjusting entry.