Quiz_4_Key - ACC 5110 QUIZ 4 Name Part I Choose the best...

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ACC 5110 Winter 2010 QUIZ 4 Name: KEY Part I. Choose the best answer. 1. Which of the following is a current liability? a. A long-term debt maturing currently, which is to be paid with cash in a sinking fund b. A long-term debt maturing currently, which is to be retired with proceeds from a new debt issue c. A long-term debt maturing currently, which is to be converted into common stock d. None of these (please see the chapter slide #18) 2. Which of the following statements is false? a. A company may exclude a short-term obligation from current liabilities if the firm intends to refinance the obligation on a long-term basis and demonstrates an ability to complete the refinancing. b. Cash dividends should be recorded as a liability when they are declared by the board of directors. c. Under the cash basis method, warranty costs are charged to expense as they are paid. d. FICA taxes withheld from employees' payroll checks should never be recorded as a liability since the employer will eventually remit the amounts withheld to the appropriate taxing authority. 3. Lett Co. has a probable loss that can only be reasonably estimated within a range of outcomes.
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Quiz_4_Key - ACC 5110 QUIZ 4 Name Part I Choose the best...

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