ACC 291 Week 3 Practice Quiz
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Practice Question 01
The time period for classifying a liability as current is one year or the operating cycle, whichever is
Practice Question 05
Which one of the following is not a typical current liability?
|Current maturities of long-term debt|
Practice Question 10
Buttner Company borrows $88,500 on September 1, 2017, from Harrington State Bank by signing an $88,500, 12%, one-year note. How much is accrued interest at December 31, 2017?
Practice Question 25
How is the market value of a bond issuance determined?
|By adding the face value of the principal amount to the stated value of the interest payments.|
|By computing the present value of the principal.|
|By computing the present value of the interest payments.|
|By adding the present value of the principal amount to the present value of the interest payments.|
Practice Question 30
If the contractual rate of interest is lower than the market rate of interest, bonds will sell at a premium.
Practice Question 35
What is the effect of amortizing a bond discount?
|It decreases bond interest expense.|
|It increases the carrying value of the bonds.|
|It decreases the maturity value of the bonds.|
|There is no effect on the bond interest expense.|
Practice Question 31
Cuso Inc. issues 10-year bonds with a maturity value of $200,000. If the bonds are issued at a premium, what does this indicate?
|The contractual interest rate exceeds the market interest rate.|
|The contractual interest rate and the market interest rate are the same.|
|The market interest rate exceeds the contractual interest rate.|
|No relationship exists between the market and contractual rates.|
Practice Question 34
When a bond is sold at a premium, at what amount is it reported on the balance sheet?
Practice Question 36
Tanner, Inc. issued a 10%, 5-year, $100,000 bond when the market rate of interest was 12%. At what value will the bond sell?
Practice Question 46
Which of the following is not a commonly used method of presenting current liabilities on the balance sheet?
|Listing currently maturing long-term debt first.|
|Listing current debt in the order of oldest first and then chronologically.|
|In order of magnitude or size.|
|In order of their maturity.|