Unformatted text preview: isted companies. A company may classify a long-term obligation due to be settled within
twelve months as a long-term liability instead of a current liability on its year
end balance sheet if the company? intends to refinance this obligation on a long-term basis.
can show that it has the ability to obtain refinancing on a long-term basis.
pays off these amounts after the balance sheet date and subsequently obtains a
long-term loan to replace this obligation before the date of authorization of the
None of the above 4 ACCT201
Q9. Bright Roofing Ltd manufactures roofing materials. Previously, Bright Roofing
had used asbestos, a health hazard, in the manufacture of ceiling materials. As a
result, some the company’s employees contracted asbestos related disease. In recent
court cases, some other companies who also used asbestos in the manufacture of
ceiling materials were found liable to pay compensation of varying amounts to
persons who had contracted asbestos disease. The compensations paid by these
companies vary with the age, educational qualifications and severity of the illness of
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This document was uploaded on 04/07/2014.
- Spring '14