Chapter 8 - Part 1 - Chapter 8 Liabilities Part 1 Current...

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Page 1 ACCT 2331 – Dr. Lazer 1 Chapter 8: Liabilities Part 1 – Current Liabilities Dr. Ron Lazer Financial Accounting GAAP (Generally Accepted Accounting Principles) The Accounting Information System Financial Statements Balance Sheet Income Statement Ron Lazer, Ph.D.
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Page 2 ACCT 2331 – Dr. Lazer Classification Current Liabilities s First: what is a liability? b “Probable future sacrifice of economic benefits arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past transactions or events.” b Future sacrifice. b Present obligations. b Past transactions or events. s Classification of Current Liability b expected to require the use of current assets (or the creation of other current liabilities) to settle the obligation. s Valuing current liabilities on the balance sheet: b Ignore present value (because short-term). b Report at face value. Current Liabilities s Accounts payable - covered previously s Short-term notes payable s Sales tax payable s Accrued liabilities (salaries, rent, insurance, etc.) s Unearned revenues – covered in chapter 3 s Current portion of long-term debt s Estimated warranty payable s Contingent liabilities Ron Lazer, Ph.D.
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Page 3 ACCT 2331 – Dr. Lazer Notes Payable (N/P) s Promissory notes that are evidence of a debt and state the terms of payment. s
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This note was uploaded on 01/09/2010 for the course ACCT 2331 taught by Professor Staff during the Fall '08 term at University of Houston.

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Chapter 8 - Part 1 - Chapter 8 Liabilities Part 1 Current...

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