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CHAPTER 13 CURRENT LIABILITIES AND CONTINGENCIES IFRS questions are available at the end of this chapter. TRUE-FALSE Conceptual Answer No. Description F 1. Zero-interest-bearing note payable. F 2. Dividends in arrears. T 3. Examples of unearned revenues. T 4. Reporting discount on Notes Payable. F 5. Currently maturing long-term debt. F 6. Excluding short-term debt refinanced. T 7. Accounting for sales tax collected. F 8. Accounting for sick pay. T 9. Social security taxes as liabilities. F 10. Definition of accumulation rights. T 11. Recognizing compensated absences expense. F 12. Accruing estimated loss contingency. T 13. Disclosing gain contingencies. F 14. Sales-type warranty profit. T 15. Fair value of asset retirement obligation. T 16. Reporting a litigation liability. F 17. Expense warranty approach. F 18. Acid-test ratio components. F 19. Affect on current ratio. T 20. Reporting current liabilities. MULTIPLE CHOICE Conceptual Answer No. Description d 21. Definition of a liability. d 22. Nature of current liabilities. a 23. Recording of accounts payable. a 24. Classification of notes payable. b 25. Classification of discounts on notes payable. d 26. Identify current liability. c 27. Bonds reported as current liability. d 28. Identify item which is not a current liability. c 29. Dividends reported as current liability. d 30. Classification of stock dividends distributable. c 31. Identify item which is not a current liability. d 32. Identify current liability. c 33. Characteristic of current liability. d 34. Definition of a liability. b 35. Importance of liability section of balance sheet. a 36. Current liabilities and operating cycle. Test Bank for Intermediate Accounting, Thirteenth Edition MULTIPLE CHOICE Conceptual (cont.) Answer No. Description a 37. Present value and concept of a liability. c 38. Zero-interest-bearing notes payable. d 39. Callable debt reporting. d 40. Condition to exclude short-term obligation. a 41. Ability to consummate refinancing of short-term debt. b 42. Disclosure of preferred dividends not declared. c 43. Example of unearned revenue. d 44. Short-term obligations expected to be refinanced. d 45. Ability to consummate refinancing of short-term obligations. d 46. Determine what is a liability. a 47. Classification of sales taxes. d S 48. Disclosure for short-term debt refinanced. b S 49. Vested rights vs. accumulated rights. d P 50. Deductions in computing net pay. d 51. Employer's payroll tax expense. d 52. Accrual of a liability for compensated absences. c 53. Accrual of a liability for compensated absences. d 54. Accrual of a liability for compensated absences. d 55. Compensated absences. d 56. Requirements for compensated absences accrual.... View Full Document

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