Homework week 4 - Homework week 4 Lien Bach PART A...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Homework week 4 – Lien Bach PART A Long-term liabilities consists of probable future sacrifices of economic benefits arising from present obligations that are not payable within a year or the operating cycle of the company, whichever is longer. Examples of long-term liabilities are bonds payable, long-term notes payable, mortgages payable, pension liabilities, and lease liabilities. Long term bond liabilities are reported at their amortized value. This means that if a bond was issued at a premium, the total bond liability at the end of the reporting period will be the total par value of the bond and the premium received less issuance cost. Premium on bonds payable is a contra account to bonds payable that increases its value and is added to bonds payable in the long-term liability section of the balance sheet. However, if bond was issued at a discount, it would be the total par value less unamortized discount. Discount on bonds payable is a contra account to bonds payable that decreases the value of the bonds and is subtracted from the bonds payable in the long-term liability section of the balance sheet. Leases are considered as either an operating lease or a capital lease (finance lease). An operating lease records no asset or liability on the financial statements, the amount paid is
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 03/06/2011 for the course ACC 545 taught by Professor Cole during the Spring '09 term at University of Phoenix.

Page1 / 5

Homework week 4 - Homework week 4 Lien Bach PART A...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online