Define current liability, Financial Accounting

Assignment Help:

The following items represent liabilities on a firm's balance sheet:
a. An amount of money owed to a supplier based on the terms 2/20, n/40, for which no note
was executed.
b. An amount of money owed to a creditor on a note due April 30, 2013.
c. An amount of money owed to a creditor on a note due August 15, 2014.
d. An amount of money owed to employees for work performed during the last week in December.
e. An amount of money owed to a bank for the use of borrowed funds due on March 1, 2013.
f. An amount of money owed to a creditor as an annual installment payment on a ten-year
note.
g. An amount of money owed to the federal government based on the company's annual
income.

Required
1. For each item, state whether it should be classified as a current liability on the December 31,
2012, balance sheet. Assume that the operating cycle is shorter than one year. If the item
should not be classified as a current liability, indicate where on the balance sheet it should be
presented.
2. For each item identified as a current liability in part (1), state the account title that is normally used to report the item on the balance sheet.
3. Why would an investor or a creditor be interested in whether an item is a current or a longterm liabilities?

 


Related Discussions:- Define current liability

Types of temporary differences-financial statement, Types of temporary diff...

Types of temporary differences There are two main types of temporary differences; 1) Taxable temporary difference : If the carrying amount is more than the tax base then

Accounting 2 assistance, working with par value and common value and prefer...

working with par value and common value and preferred value in accounting help

Find the expected time a person will spend, A new shopping mall is consider...

A new shopping mall is considering setting up an information desk staffed by one (1) employee. Based upon information obtained from similar information desks, it is believed that p

Case law about investment, As an investor, you are considering buying stock...

As an investor, you are considering buying stock in a relatively new company. Medical Horizons, Inc., has been in existence for 10 years and is now about to go public. The first st

Show the expatriation tax, Q. Show the Expatriation Tax? Expatriation T...

Q. Show the Expatriation Tax? Expatriation Tax - Individuals who loose or terminate their residency within 10 year period immediately preceding the close of a tax year, if term

Consolidating Accounting, I have an assignment in consolidation accounting ...

I have an assignment in consolidation accounting and would like to know if you can assist me in doing the assignment for me. I am doing BA in Accounting . Please let me know. Re

Review, objective of working capital management and profitability

objective of working capital management and profitability

The aicpa''s mission, Will you please summarize this mission statement of A...

Will you please summarize this mission statement of AICPA'S "The AICPA's mission is to provide members with resources, information and leadership that enable them to provide val

Calculate the profits for investments, Both a call and a put currently are ...

Both a call and a put currently are traded on stock XYZ; both have strike prices of $50 and expirations of 6 months.  What will be the profit to an investor who buys the call for $

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd