TEST BANK FOR Current Liabilities, Contingencies, and the True
Value of Money CHAPTER 9 LATEST UPDATED VERSION
2026.WITH A CORRECT ANSWERS.
True / False
1. A note payable due in two years is a current liability.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
2. The current maturity of long-term debt is a current liability.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
3. A note payable that is due in six months is a current liability.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
4. If a bank discounts a note, then the borrower needs to only pay the cash received and not the face value of the note.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
5. A possible loss from lawsuit is not reported on the balance sheet as a current liability.
a. True
b. False
© 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
,Chapter 9: Current Liabilities, Contingencies, and the True Value of Money
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
FACC.PONO.13.09-04 - LO: 09-04
KEYWORDS: Bloom's: Remembering
© 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
,Chapter 9: Current Liabilities, Contingencies, and the True Value of Money
6. Discount on Notes Payable is treated as a reduction of notes payable on the balance sheet.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
7. For users of financial statements, the current liability classification in the balance sheet is important because it is most
closely tied to the concept of profitability.
a. True
b. False
ANSWER: False
DIFFICULTY: Moderate
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
8. When a liability is accrued, the account debited in the transaction is a stockholders’ equity account.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-02 - LO: 09-02
KEYWORDS: Bloom's: Applying
9. U.S. standards require a classified balance sheet, but International accounting standards do not require companies to
present classified balance sheets with liabilities classified as either current or long term.
a. True
b. False
ANSWER: False
DIFFICULTY: Moderate
LEARNING OBJECTIVES: FACC.PONO.13.09-02 - LO: 09-02
KEYWORDS: Bloom's: Remembering
10. Accrued wages is a current liability.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-02 - LO: 09-02
KEYWORDS: Bloom's: Remembering
© 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
, Chapter 9: Current Liabilities, Contingencies, and the True Value of Money
© 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Value of Money CHAPTER 9 LATEST UPDATED VERSION
2026.WITH A CORRECT ANSWERS.
True / False
1. A note payable due in two years is a current liability.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
2. The current maturity of long-term debt is a current liability.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
3. A note payable that is due in six months is a current liability.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
4. If a bank discounts a note, then the borrower needs to only pay the cash received and not the face value of the note.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
5. A possible loss from lawsuit is not reported on the balance sheet as a current liability.
a. True
b. False
© 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
,Chapter 9: Current Liabilities, Contingencies, and the True Value of Money
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
FACC.PONO.13.09-04 - LO: 09-04
KEYWORDS: Bloom's: Remembering
© 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
,Chapter 9: Current Liabilities, Contingencies, and the True Value of Money
6. Discount on Notes Payable is treated as a reduction of notes payable on the balance sheet.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
7. For users of financial statements, the current liability classification in the balance sheet is important because it is most
closely tied to the concept of profitability.
a. True
b. False
ANSWER: False
DIFFICULTY: Moderate
LEARNING OBJECTIVES: FACC.PONO.13.09-021 - LO: 09-02
KEYWORDS: Bloom's: Remembering
8. When a liability is accrued, the account debited in the transaction is a stockholders’ equity account.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-02 - LO: 09-02
KEYWORDS: Bloom's: Applying
9. U.S. standards require a classified balance sheet, but International accounting standards do not require companies to
present classified balance sheets with liabilities classified as either current or long term.
a. True
b. False
ANSWER: False
DIFFICULTY: Moderate
LEARNING OBJECTIVES: FACC.PONO.13.09-02 - LO: 09-02
KEYWORDS: Bloom's: Remembering
10. Accrued wages is a current liability.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
LEARNING OBJECTIVES: FACC.PONO.13.09-02 - LO: 09-02
KEYWORDS: Bloom's: Remembering
© 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
, Chapter 9: Current Liabilities, Contingencies, and the True Value of Money
© 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
