Question: All of the following statements regarding liabilities are true except;

Answer: Potentail future wages to be paid to employees should be recorded as liabilities.

Question: Obligation to be paid within one year or the company’s operating cycle, whichever is longer, are;

Answer: Current liabilities

Question: Obligation not expected to be paid within the longer of one year or the company’s operating cycle are reported as;

Answer: Long-term liabilities

Question: All of the following statements regarding uncertainty in liabilities are true except;

Answer: A company only records liabilities when it knows whom to pay, when to pay, and how much to pay. Without all three, a liability cannot be recorded.

Question: In order to be reported, liabilities must;

Answer: Sometimes be estimated.

Question: All of the following are true of known liabilities except;

Answer: May depend on some future event occurring.

Question: Accounts payable are;

Answer: amounts owed to suppliers for products and/or services purchased on credit

Question: Amounts received in advance from customers for future products or services;

Answer: Are liabilities

Question: Sales taxes payable reported as a(an);

Answer: Current liability

Question: Which of the following do not apply to unearned revenues?

Answer: Amounts to be received in the future from customers for delivery of products or services in the current period.