Module 3 Quiz of Understanding Financial Statements Company Position
What is a liability?
Current liabilities are not expected to require payment to be made within a year. True or false?
If a company receives several shipments from a supplier during a month, it can be more convenient to pay one time at the end of the month. The company will owe the supplier payment for the supplies, and the amount owed will be reported on the company balance sheet during the month as what?
Accrued liabilities are not a liability, but are actually an expense. True or false?
Which is NOT an example of an accrued liability?
Accrued liabilities are a current liability on the balance sheet. True or false?
Where is accounts payable found on the balance sheet?
What section of the balance sheet can be thought of as a company’s debt?
Obtaining a loan to buy a bakery that is in the process of making repayment would be considered a current liability since there are payments being made. True or false?
All debt on a company’s balance sheet is bad. True or false?
There is always a cash payment needed to satisfy a liability. True or false?
Which is a long-term liability?
When a company has long-term debt, the debt agreement often requires the company to pay a portion of the debt each year. True or false?
What is an advantage to a company of taking on debt?
What measurement question can be answered by looking at liabilities on the balance sheet?
If you delivered inventory to John, but John had not paid for the inventory yet, what liability account for John would increase?
A dance studio that receives payment from customers to deliver children dance lessons is an example of the dance studio’s what?