ch13HWSolutions

ch13HWSolutions - CHAPTER 13 Current Liabilities and...

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Unformatted text preview: CHAPTER 13 Current Liabilities and Contingencies EXERCISE 13-1 (a) Current liability. (b) Current liability. (c) Current liability or long-term liability depending on term of warranty. (d) Current liability. (e) Footnote disclosure (assume not probable and/or not reasonably estimable). (f) Current liability. (g) Current or noncurrent liability depending upon the time involved. (h) Current liability. (i) Current liability. (j) Current liability. (k) Current liabilities or long-term liabilities as a deduction from face value of note. (l) Current liability. (m) Current liability. (n) Current liability. (o) Footnote disclosure. (p) Separate presentation in either current or long-term liability section. EXERCISE 13-3 ALEXANDER COMPANY Partial Balance Sheet December 31, 2010 Current liabilities: Notes payable (Note 1)..................................................... $300,000 Long-term debt: Notes payable refinanced in February 2011 (Note 1).... 900,000 Note 1. Short-term debt refinanced. As of December 31, 2010, the company had notes payable totaling $1,200,000 due on February 2, 2011. These notes were refinanced on their due date to the extent of $900,000 received from the issuance of common stock on January 21, 2011. The balance of $300,000 was liquidated using current assets. OR Current liabilities: Notes payable (Note 1)..................................................... $300,000 Long-term debt: Short-term debt expected to be refinanced (Note 1)..... 900,000 (Same footnote as above.) EXERCISE 13-11 (a) Cash....................................................................... ................................................................................ 3,000,000 Sales (500 X $6,000).................................... 3,000,000 Warranty Expense................................................ 30,000 Cash, Inventory, Accrued Payroll............. 30,000 Warranty Expense................................................ 90,000 Estimated Liability Under Warranties ($120,000 $30,000)................................. 90,000 (b) Cash.......................................................................Cash....
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ch13HWSolutions - CHAPTER 13 Current Liabilities and...

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