Quiz 1 - Ch. 1,2, 3 (100 points)
Show your work!
For each of the two situations below, state if the accounting method or principle used is correct or incorrect. If
correct, identify which principle or assumption supports the method used. I
Chapters 6, and 7
DUE: Friday October 31, 2014
TRUE/FALSE Questions (0.5 points each)
1. Securitization of receivables is a type of secured borrowing. TRUE_/FALSE_
2. Unless specific sales criteria are met, the factoring o
Chapter 10 Capacity and Legality
Identify and briefly describe the four categories of contracts which are against public policy.
ANSWER: A. Exculpatory Contracts: attempts to escape liability of the party at fault.
B. Agreements in Restraint of Trade
Quiz 1 - Ch. 1,2,3 (10 points)
For each of the two situations below, state if the accounting method or principle used is correct or incorrect. If correct, identify
which principle or assumption supports the method used. If incorrect, ident
1. The following information relates to the Jordan, Inc:
Increase in salaries payable
Purchased operating equipment
Increase in accounts receivable
What is the net cash provided by