ss 11 - 9 C A contingent liability should be recorded in...

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Brittney Acevedo Professor Abatemarco 1. A. The time period for classifying a liability as current is one year or the operating cycle, whichever is longer. 2. D. To be classified as a current liability, a debt must be expected to be paid out of existing current assets and by creating other current liabilities. 3. B. 88500*12%*4/12= 3540 4. D. At the end of the year for a 6 month not both a note payable and an interest payable are current liabilities. 5. B. 4515/1.05= 4300 6. B. 18000-13500= 4500 7. A. Working capital is calculated as current assets minus current liabilities. 8. D. The current ratio is computed as current assets divided by current liabilities.
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Unformatted text preview: 9. C. A contingent liability should be recorded in the accounts when it is probable the contingency will happen, and the amount can be reasonably estimated. 10. B. Estimated Warranty Liability is in the adjusting entry for a warranty contract. 11. D. 560+105= 665 12. C. When recording payroll deductions are recorded as liabilities. 13. C. Employer payroll taxes do not include federal income taxes. 14. B. $7,500 because it should be equal on both entries. 15. D. The department that should pay the payroll is the treasurer's department. 16. D. Salaries are not an additional fringe benefit....
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