Current liabilities are defined as those liabilities which will be satisfied
a. by the end of the operating cycle.
b. within one year.
c. within one year or within the operating cycle, whichever is longer.
d. within one year or within the operating cycle, whichever is shorter.
c
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O'Malley Inc purchased an asset costing $90,000. Annual operating cash inflows are expected to be $20,000 each year for six years. No salvage value is expected at the end of the asset's life. Assuming O'Malley's cost of capital is 16 percent, what is the asset's net present value? (ignore income taxes)
A) $(16,306) B) $30,000 C) $(5,600) D) $4,800
The FASB-IASB convergence project on leases resulted in the following:
A. Lease accounting will differ for lessees in that, under IFRS, all leases will be treated as finance leases both on the balance sheet and in the measurement of net income, and under U.S. GAAP lessees will capitalize operating leases on the balance sheet similar to finance leases but will treat them as traditional operating leases in the measurement of income. B. Lease accounting will differ in that under IFRS lessees will capitalize some leases as finance leases and others as operating leases, while under U.S. GAAP lessees will capitalize all leases as finance leases but treat them as traditional operating leases in the measurement of net income. C. Lease accounting will be the same under IFRS and under U.S. GAAP in that lessors and lessees will capitalize all leases as finance leases and treat them as such in the measurement of income. D. Lease accounting will be similar under IFRS and U.S. GAAP for lessees but will differ for lessors in their treatment of the measurement of net income. E. Lessor and lessee accounting will be the same under IFRS and under U.S. GAAP in that lessors will capitalize all leases and lessees will capitalize some leases as finance leases but treat others as operating leases.
A company that provides services (not goods) to its customers may incur costs that are appropriately classified as product-level costs.
Answer the following statement true (T) or false (F)
Incorporation fees, attorneys' fees, and promotional expenses are known as organization costs and are expensed in the first two years of operation of the corporation.
Answer the following statement true (T) or false (F)