10a

1. 160. Liabilities are classified on the statement of financial position as current or
   

   1. A(a) deferred.
   2. B(b) unearned.
   3. C(c) non-current.
   4. D(d) accrued.
2. 261. Most companies pay current liabilities
   

   1. A(a) out of current assets.
   2. B(b) by issuing notes payable.
   3. C(c) by issuing common shares.
   4. D(d) by creating non-current liabilities.
3. 362. A current liability is a debt that can reasonably be expected to be paid
   
   

   1. A(a) within one year.
   2. B(b) between 6 months and 18 months.
   3. C(c) out of currently recognized revenues.
   4. D(d) out of cash currently on hand.
4. 463. Which of the following would most likely be classified as a current liability?
   

   1. A(a) Mortgage payable
   2. B(b) Bonds payable
   3. C(c) Operating lease
   4. D(d) Dividends payable
5. 564. Failure to record a liability will probably
   

   1. A(a) result in overstated profit.
   2. B(b) result in overstated total liabilities and shareholders’ equity.
   3. C(c) have no effect on profit.
   4. D(d) result in overstated total assets.
6. 665. Very often, failure to record a liability means failure to record a(n)
   

   1. A(a) revenue.
   2. B(b) asset.
   3. C(c) note.
   4. D(d) expense.
7. 766. Current liabilities are
   

   1. A(a) not receivable for more than one year.
   2. B(b) not payable for more than two years.
   3. C(c) receivable within one year.
   4. D(d) payable within one year.
8. 867. Dream Design Inc. received its annual property tax bill for $16,800 in January. It was paid when due on March 31. Dream Design’s year end is Dec 31. The Dec 31 balances should be

   1. A(a) $4,200 for Prepaid Property Tax, $12,600 for Property Tax Expense.
   2. B(b) $4,200 for Prepaid Property Tax , $4,200 for Property Tax Payable.
   3. C(c) $0 for Prepaid Property Tax, $0 for Property Tax Payable.
   4. D(d) $1,400 for Prepaid Property Tax, $15,400 for Property Tax Expense.
      
9. 968. Layton Inc. had an operating line of credit of $100,000 and overdrew its bank balance to result in a negative cash balance of $15,000 at year-end. This would be reported in the statement of financial position as

   1. A(a) a current liability of $15,000.
   2. B(b) a non-current liability of $85,000.
   3. C(c) a current asset of $85,000.
   4. D(d) a current asset of $(15,000).
      
10. 1069. As interest is recorded on a bank loan payable, the Interest Expense account is
    

    1. A(a) increased; the Bank Loan Payable account is increased.
    2. B(b) increased; the Bank Loan Payable account is decreased.
    3. C(c) increased; the Interest Payable account is increased.
    4. D(d) decreased; the Interest Payable account is increased.

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Quiz on 10a, created by Aeren Tempest on 18/03/2015.

Author

Aeren Tempest

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English

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