Foundations of Business Finance (Peregrine)Exam 100% Correct!

True or false: The one fixed asset that is not depreciated is land because it seldom declines in value. - ANSWERTrue __________ liabilities are those due within one year. - ANSWERCurrent __________-__________ __________ liabilities are due after more than a year, and may include bonds, mortgages, and long-term loans. - ANSWERLong-term debt Name the three types of accounts listed as current liabilities on balance sheets. - ANSWER(1) Accounts Payable (2) Notes Payable (3) Accrued Expenses Accounts payable - ANSWERThe amounts owed for credit purchases by a firm Notes payable - ANSWEROutstanding short-term loans, typically from commercial banks Accrued expenses - ANSWERCosts that have been incurred by a firm which have not yet been paid; examples of accruals include taxes owed to the government and unpaid wages The __________ __________ section of a balance sheet provides information about the claims against a firm held by investors who own preferred and common shares. - ANSWERStockholders' equity The Stockholders' equity section of the balance sheet is reflected in four types of accounts. These include __________ __________, __________ __________, __________-__________-__________ __________ ___________ __________ __________, and __________ __________. - ANSWER(1) preferred stock (2) common stock (3) paid-in-capital excess of par (4) retained earnings __________ __________ shows the total proceeds from the sale of preferred stock. - ANSWERPreferred stock __________-__________-__________ __________ __________ __________ __________ equals the number of shares outstanding multiplied by the original selling price of the shares, net of the par value. - ANSWERPaid-in-capital in excess of par __________ __________ equals the number of outstanding common shares