Current liabilities are initially measured at:
a. face value.
b. present value based on current interest rates.
c. present value plus stated interest.
d. book value.
ANSWER: A
You might also like to view...
Virginia Jackson is opening Jackson Realty on January 2. For several weeks she has been busy putting together an operating budget for the first quarter of operations for her new business. Virginia has estimated her selling and administrative (S&A) costs as follows:?JanuaryFebruaryMarchDepreciation$ 1,000$ 1,000$ 1,000Marketing expenses2,0001,4001,000Miscellaneous costs500400400Rent expense5,0005,0005,000Salary expense4,0008,0008,000Sales commissions1,0001,2001,400Utilities expense 1,000 800 1,000Total S&A costs before interest$ 14,500$ 17,800$ 17,800All selling and administrative costs are paid when incurred except utilities, marketing expenses, and sales commissions. These items are paid in the
month following the month incurred.Required:1) Prepare a schedule of cash payments for selling and administrative expenses for January through March.2) What liabilities, in what amounts, would be reported on the pro forma balance sheet as of March 31? What will be an ideal response?
The three major activities in new-product development are to (1) generate new ideas, (2) screen and evaluate ideas, and (3) define and test product concept.
Answer the following statement true (T) or false (F)
According to the basic capital structure theory proposed by Modigliani and Miller (MM), when will a firm's value be maximum?
A. When it is financed entirely with equity. B. When its capital structure contains 50 percent debt and 50 percent equity. C. When it is financed entirely with retained earnings. D. When it is financed with almost 100 percent through debt. E. When its assets are financed with 50 percent equity and 50 percent retained earnings.
The expectations theory postulates that the term structure of interest rates is based on expectations regarding future inflation rates.?
Answer the following statement true (T) or false (F)