CURRENT LIABILITIES & CONTINGENCIES ECON 136A REFRESHER What is a liability? Present (not necessarily current) unavoidable obligation; Result of a past transaction; Chapter 13 What makes a liability current? Conversion in one year or operating cycle‚ whichever is longer Current liabilities are not recorded at their present value as they “turn” soon enough that there is no material difference. Bob Anderson‚ UCSB 2004 13-1 13-2 Bob Anderson‚ 2004 07:35 136A Concepts Notes Payable
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b_____ 17. _f____ 18. _b____ 19. c_____ 20. e_____ 21. _a____ 22. a_____ 23. b_____ 24.c _____ 25.b _____ 26. b_____ 27. b_____ 28d. _____ 29. _d____ 30. _f____ 1. A city’s General Fund general ledger includes accounts called Estimated Revenues‚ Appropriations‚ and Encumbrances. This indicates that the city a) formally integrates its budget into its accounts. b) uses a cash plus encumbrances basis of accounting. c) maintains its accounts on an accrual basis. d) erroneously
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provided amounted to $12 million. The company estimated that warranty costs would amount to 3% of the sales amount. During the year‚ the company spent $510‚000 on warranty costs. Required: i) What amount should be recorded as warranty expense for 2013 by the company? ii) What warranty provision should be included in the company’s statement of financial position as at December 31‚ 2013? b) Kleinberg Corporation was sued by a customer for product liability. The customer sought damages of $1‚500
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DEVRY UNIVERSITY Comcast Corporation Financial Analysis of 2013 Annual Reports Intermediate ACCT II project 6/15/2014 Analysis by Page Table of Contents Introduction The Comcast Corporation is the largest cable and home internet provider in the United States. The company functions as a cable provider and ISP‚ including telephone services for residential and commercial customers throughout the US. This makes Comcast a central focus for both customer and competitor criticism
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CHAPTER 13 – CURRENT LIABILITIES AND CONTINGENCIES I. Liabilities A. Three Characteristics 1. Probable‚ future sacrifices of economic benefits 2. That arise from present obligations 3. Resulting from past transactions B. Current Liabilities 1. Payable within 1 year 2. Reported at maturity value C. Types of Current Liabilities 1. Accounts Payable a. Buy merchandise on account
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870 Total cash = $ 1900 Mr Simpson ( The accountant ) calculated the depreciation on the equipment to be $ 2445. Net cost of equipment= $( 53200-2455)= $ 50755 Lone Pine café owed suppliers = $ 1583 Food and beverages on hand were estimated to be about $2430. Inventory = $ 2430 The partnership had repaid $2100 of the loan from Bank. Thus loan remaining: $( 21000-2100)= $ 18900 The prepaid local operating expense had been used for 5 months. Thus this should be subtracted
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deferred tax liability should be recorded to reflect the future tax consequences of the temporary difference. Income tax expense (to balance) 140‚000 Deferred tax liability ([$400‚000 – 250‚000] x 35%) 52‚500 Income tax payable ($250‚000 x 35%) 87‚500 As a result‚ net income is $260‚000: Pretax accounting income $400‚000 Income tax expense 140‚000 Net income $260‚000 Requirement 2 In its balance sheet‚ Alvis will report the $52‚500 deferred tax liability among either
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incurred is derived using the straight line method. We do not depreciate our land. We estimate our useful life for our assets accordingly; buildings have a 40 year life‚ computer equipment has a 5 year life and the repair equipment a 15 year life. The estimated lives of our assets are reviewed periodically to determine if any impairment is present so the useful lives and depreciation can be adjusted for accuracy. Short-term Investments All of our investments are comprised of trading securities comprised
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values of Colonial’s assets and liabilities‚ which Buff is interested in acquiring. Against these assets are claims of suppliers and bank loan used to finance a portion of the inventory. Buff hired a valuation consultant for Colonial’s tangible assets and liabilities.
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1 for 2 reverse stock split All accounts are not affected. However‚ number of shares will decrease to 500‚000 while par value per share will increase to $20. A company whose stock stock is selling for $60 has the following balance sheet: Assets Liabilities Preferred stock Common stock ($12 par; 100‚000 shares outstanding) Paid-in capital Retained earnings Construct a new balance sheet showing the effects of 3 for 1 stock split‚ What is the new price of the stock? Assets 2. 30‚000‚000 14‚000
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