Showing posts with label long-term debt. Show all posts
Showing posts with label long-term debt. Show all posts

Saturday, October 10, 2020

Region Jet has a $50 million liability at December 31, 2021, of which $10 million is payable in 2022. In its December 31, 2021 balance sheet,

Region Jet has a $50 million liability at December 31, 2021, of which $10 million is payable in 2022. In its December 31, 2021 balance sheet, the company reports the $50 million debt as a:



A) $50 million current liability in the balance sheet.

B) $50 million long-term liability in the balance sheet.

C) $10 million current liability and a $40 million long-term liability in the balance sheet.

D) $40 million current liability and a $10 million long-term liability in the balance sheet.


Answer: C


United Supply has a $5 million liability at December 31, 2021, of which $1 million is payable in each of the next five years. United Supply reports the liability in the balance sheet as a:



A) $5 million current liability.

B) $5 million long-term liability.

C) $1 million current liability and a $4 million long-term liability.

D) $4 million current liability and a $1 million long-term liability.


Answer: C


The current portion of long-term debt is:



A) The amount that will be paid within one year of the balance sheet date.

B) Reported as an asset.

C) Reported as a long-term liability.

D) None of the other answer choices is correct.


Answer: A

Union Apparel has sales including sales taxes for the month of $551,200. If the sales tax rate is 6%, how much does Union Apparel owe for sales tax?

Union Apparel has sales including sales taxes for the month of $551,200. If the sales tax rate is 6%, how much does Union Apparel owe for sales tax?



A) $51,200.

B) $33,272.

C) $31,200.

D) $551,200.


Answer: C


Union Apparel has sales including sales taxes for the month of $551,200. If the sales tax rate is 6%, what are Union Apparel's sales for the month?



A) $500,000.

B) $518,128.

C) $520,000.

D) $551,200.


Answer: C

The current portion of long-term debt should be



A) Reported as a current liability in the balance sheet.

B) Reported as a long-term liability in the balance sheet.

C) Combined with the rest of the long-term debt in the balance sheet.

D) Paid immediately.


Answer: A

Assuming a current ratio of 1.2 and an acid-test ratio of 0.80, how will the purchase of inventory with cash affect each ratio?

Assuming a current ratio of 1.2 and an acid-test ratio of 0.80, how will the purchase of inventory with cash affect each ratio? A) Increase ...