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WorksheetsQUIZ: TOPIC 10 ACCOUNTING FOR LIABILITIES
Total questions: 10
Worksheet time: 6mins
What is the definition of liabilities?
Liabilities are obligations owed.
Liabilities are items that are owned with value.
Liabilities are the cost of doing business.
Which of the following items is a long-term liability?
Accrued expenses payable.
Unearned revenue.
Mortgages payable.
Accounts payable.
Suppose a hotel has RM40,000 of long-term debt at year end. Of this amount, RM10,000 must be repaid within the next year. Which of the following statements is true?
The classified balance sheet would show RM40,000 of long-term debt under the heading "Current liabilities."
The classified balance sheet would show RM40,000 of long-term debt under the heading "Long-term liabilities."
The classified balance sheet would show RM50,000 of long-term debt under the heading "Long-term liabilities."
The classified balance sheet would show RM30,000 of long-term debt under the heading "Long-term liabilities."
Which of the following accounts is NOT a liability?
Accounts Payable
Accounts Receivable
Salaries Payable
Notes Payable
Warranty is one of Contingent Liabilities.
TRUE
FALSE
Current liabilities: Liabilities that are expected to be paid within a year or normal operating cycle, whichever is longer.
TRUE
FALSE
On December 1, ABC Co. hired Juanita Perez to begin working on January 2 at a monthly salary of RM4,000. ABC's balance sheet of December 31 will show a liability of
RM4,000
RM48,000
No Liability
The expected balance in the account Bonds Payable.
Debit
Credit
Entity A issued RM200,000 bonds and received RM200,000 in cash.
Journal entry to record this transaction:
Dr. Bonds Payable 200,000
Cr. Cash 200,000
Dr. Cash 200,000
Cr. Bonds Payable 200,000
The interest charged on a RM100,000 note payable, at the rate of 10%, on a 60-day note would be
RM1,667
RM10,000
RM6,000
RM16,667
