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Non-Current Liabilities Test

Total questions: 7

Worksheet time: 11mins

Name
Class
Date
1.

Which one is not a leverage ratio

a)

Debt-to-aassets ratio

b)

Interest coverage ratio

c)

Debt-to-capital ratio

d)

Financiaal leverage ratio

2.

When a bond is issued at a price equal to its face value, the bond is said to have been used....

a)

at discount

b)

above fair vale

c)

at par

d)

at risk

3.

Under ............................ companies generally show these debt issuance costs as an asset.

a)

IFRS

b)

IASB

c)

NIC

d)

US GAAP

4.

Which of the following statements is true?

a)

Negative covenants restrict the borrower's activities by requiring ceretain actions.

b)

Covenants always restrict the borrower's ability to invest.

c)

Covenants may specify minimum acceptable levels of fanancial ratios.

d)

The covenants protect borrowers by restricting activities of the lender.

5.

A long-term liability broadly represents a probable sacrifice of economic benefits in periods...

a)

greater than one year.

b)

of less than one year.

c)

equal to one year.

d)

not specified.

6.

Which one is not a long-term liability?

a)

Finance leases

b)

Pension liability

c)

Bond payable

d)

Bank overdraft

7.

Which statement is false?

a)

Interest portion of lease payment is a financing cash outflow under US GAAP

b)

Interest portion of lease payment received is an operating cash inflow under US GAAP

c)

Receipt of lease principal is an investing cash inflow

d)

Rent payment is an operating cash outflow