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Int. Acct 2
Test # 2 (Chapters 13-15)
Question | Answer |
---|---|
Liabilities are | obligations arising from past transactions and payable in assets/services in the future. |
Current Liabilities | Bonds (for which there is an adequate appropriation of retained earnings) due in eleven months). |
Current Liability | ex) a cash dividend payable for preferred stockholders. |
Stock dividends distributable should be classified on the | Balance Sheet as an item of stockholders' equity |
A characteristic of a current liability but NOT a long term liability? | Liquidation is reasonable expected to require use of exiting resources classified as current assets or create other current liabilities. |
What is the relationship b/w current liabilities and a company's operating cycle? | Liquidation of current liabilities is reasonably expected within the company's operating cycle. |