, attached to the financial ents vt ubjce acceleration clause b) What is an obje

Question

, attached to the financial ents vt ubjce acceleration clause b) What is an objective acceleration clause? c) How do these clauses in debt instruments affect the 18. How has the FASB used note disclosure as a tool of 19. What are some examples of supplementary information 20. Under what circumstances does a subsequent event lead to 21. The balance sheet does not reflect the value of a business. compromise? included in the notes to financial statements? a journal entry for the previous reporting period? classfication of a liability? Distinguish between contingent liabilities and estimated bilities 10. How do the Equity sections of proprietorships, partnerships, Do you agree or disagree? Explain. and corporations differ from one another? PRACTICE EXERCISES Balance Sheet Relationships The company has assembled the following partial balance sheet data. Practice 3-1 30,000 15,000 4,000 40,000 8.000 Long-term assets. Long-term liabilities Paid-n capital. Total assets Current liabilities Use these data to compute the following quantities (a) Current assets b) Total liabilities (c) Total equity d) Retained earnings

Explanation / Answer

Long term assets        30,000 Long term liabilities        15,000 Paid-in-Capital          4,000 Total Assets        40,000 Current liabilities          8,000 Part -(a) Current assets = (Total assets - Long term assets) = (40,000-30,000) = 10,000 Part -(b) Current assets = (Total assets - Long term assets) = (40,000-30,000) = 10,000 Part -(c) Total equity = 4,000 Part -(d) Retained earnings = (Total assets - Total liabilities - Paid-in-Capital) = (40,000-23,000-4,000) = 13,000

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