Question 1

Match each of the following terms with the appropriate definitions.
-Obligations of a company requiring payment in more than one year or operating cycle.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

Long-term liabilities are financial obligations of a company that are due beyond one year or one operating cycle, whichever is longer. This distinguishes them from short-term liabilities, which are due within a year or an operating cycle.

Question 2

Match each of the following terms with the appropriate definitions.
-A number indicated on an employee's Form W-4 that is used to reduce the amount of federal income tax withheld from an employee's pay.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

A withholding allowance, indicated on an employee's Form W-4, directly influences the amount of federal income tax withheld from their paycheck. The more allowances claimed, the less tax is withheld.

Question 3

Match each of the following terms with the appropriate definitions.
-A written promise to pay a specified amount on a definite future date within one year or the company's operating cycle,whichever is longer.
A)Short-term note payable
B)Deferred income tax liability
C)Current liabilities
D)Warranty
E)Employee benefits
F)Federal depository bank
G)Payroll register
H)Gross pay
I)Payroll bank account
J)Times interest earned

Accepted Answer

A short-term note payable is a written promise to pay a specified amount on a definite future date within one year or the company's operating cycle, whichever is longer.

Question 4

Match each of the following terms with the appropriate definitions.
-Known obligations of an uncertain amount that can be reasonably estimated.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

Estimated liabilities are known obligations of an uncertain amount that can be reasonably estimated.

Question 5

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability).
-Debt guarantees
A)Long-term liability
B)Not a liability
C)Current liability

Accepted Answer

Debt guarantees are considered contingent liabilities and are not recorded as liabilities on the balance sheet until it becomes probable that the guarantee will be called upon and the amount can be reasonably estimated.

Question 6

Match each of the following terms with the appropriate definitions.
-A calculation of a company's risk of its ability to pay interest when due.
A)Short-term note payable
B)Deferred income tax liability
C)Current liabilities
D)Warranty
E)Employee benefits
F)Federal depository bank
G)Payroll register
H)Gross pay
I)Payroll bank account
J)Times interest earned

Accepted Answer

Times interest earned is a financial ratio that compares a company's income before interest and taxes (EBIT) to its interest expenses. This ratio measures a company's ability to meet its interest obligations, thus reflecting its risk of being able to pay interest when due.

Question 7

Match each of the following terms with the appropriate definitions.
-Payroll taxes on employers assessed by the federal government to support the federal unemployment insurance program.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

FUTA taxes, or Federal Unemployment Tax Act taxes, are specifically assessed by the federal government on employers to fund the federal unemployment insurance program, matching the definition provided.

Question 8

Match each of the following terms with the appropriate definitions.
-A potential obligation that depends on a future event arising from a past transaction.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

A contingent liability is a potential financial obligation that may arise in the future depending on the outcome of a specific event. It is not guaranteed to occur but is possible due to past transactions or events.

Question 9

Match each of the following terms with the appropriate definitions.
-A table of amounts of income tax to be withheld from employees' wages.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

The wage bracket withholding table is specifically designed to help employers determine the amount of income tax to withhold from employees' wages, making choice J the correct match.

Question 10

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability).
-60-day promissory note
A)Long-term liability
B)Not a liability
C)Current liability

Accepted Answer

A 60-day promissory note is considered a current liability because it is due within one year.

Question 11

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability).
-Payment of a 30-year term loan due this year
A)Long-term liability
B)Not a liability
C)Current liability

Accepted Answer

The portion of the 30-year term loan due this year is considered a current liability because it is an obligation that needs to be paid within the current fiscal year.

Question 12

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability).
-Income taxes payable
A)Long-term liability
B)Not a liability
C)Current liability

Accepted Answer

Income taxes payable are considered a current liability because they are obligations that are due within one year or within the normal operating cycle of the business, whichever is longer.

Question 13

Match each of the following terms with the appropriate definitions.
-A measure provided by a state to employers that reflects a company's stability in employing workers.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

A merit rating is a measure provided by a state to employers that reflects a company's stability in employing workers. It often influences the rate at which an employer pays state unemployment taxes, rewarding those with stable employment records.

Question 14

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability).
-FICA taxes payable
A)Long-term liability
B)Not a liability
C)Current liability

Accepted Answer

FICA taxes payable are considered a current liability because they are obligations that are expected to be settled within one year or the operating cycle, whichever is longer. These taxes are withheld from employees' wages and are due to be paid to the government periodically.

Question 15

Match each of the following terms with the appropriate definitions.
-Gross pay less all tax and voluntary deductions.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

Net pay is the amount of money an employee takes home after all deductions, including taxes and voluntary deductions, have been subtracted from the gross pay.

Question 16

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability).
-Payment of a 4-year term loan due this year
A)Long-term liability
B)Not a liability
C)Current liability

Accepted Answer

The payment of a 4-year term loan due this year is considered a current liability because it is an obligation that needs to be paid within the current fiscal year.

Question 17

Match each of the following terms with the appropriate definitions.
-Taxes that fund Social Security and Medicare,assessed on both employer and employees under the Federal Insurance Contributions Act.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

FICA taxes are specifically designed to fund Social Security and Medicare, and they are assessed on both employers and employees under the Federal Insurance Contributions Act.

Question 18

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability).
-Salaries payable
A)Long-term liability
B)Not a liability
C)Current liability

Accepted Answer

Salaries payable are considered a current liability because they represent an obligation that the company expects to pay off within one year or within the normal operating cycle, whichever is longer.

Question 19

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability).
-Payment of a 30-year term loan due next year.(The company's operating cycle is 2 months.)
A)Long-term liability
B)Not a liability
C)Current liability

Accepted Answer

The loan is due next year, which is within the company's operating cycle of 2 months. Therefore, it is a current liability.

Question 20

Match each of the following terms with the appropriate definitions.
-A seller's obligation to replace or correct a product or service that fails to perform as expected within a specified period.
A)Long-term liability
B)Warranty
C)FUTA taxes
D)FICA taxes
E)Contingent liability
F)Net pay
G)Withholding allowance
H)Estimated liability
I)Merit rating
J)Wage bracket withholding table

Accepted Answer

A warranty is a guarantee provided by a seller or manufacturer that a product or service will meet certain standards of performance and quality, and if it does not, the seller will repair, replace, or refund the product or service.

Quiz 9: Accounting for Current Liabilities

Match each of the following terms with the appropriate definitions. -Obligations of a company requiring payment in more than one year or operating cycle.

Match each of the following terms with the appropriate definitions. -A number indicated on an employee's Form W-4 that is used to reduce the amount of federal income tax withheld from an employee's pay.

Match each of the following terms with the appropriate definitions. -A written promise to pay a specified amount on a definite future date within one year or the company's operating cycle,whichever is longer.

Match each of the following terms with the appropriate definitions. -Known obligations of an uncertain amount that can be reasonably estimated.

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability) . -Debt guarantees

Match each of the following terms with the appropriate definitions. -A calculation of a company's risk of its ability to pay interest when due.

Match each of the following terms with the appropriate definitions. -Payroll taxes on employers assessed by the federal government to support the federal unemployment insurance program.

Match each of the following terms with the appropriate definitions. -A potential obligation that depends on a future event arising from a past transaction.

Match each of the following terms with the appropriate definitions. -A table of amounts of income tax to be withheld from employees' wages.

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability) . -60-day promissory note

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability) . -Payment of a 30-year term loan due this year

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability) . -Income taxes payable

Match each of the following terms with the appropriate definitions. -A measure provided by a state to employers that reflects a company's stability in employing workers.

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability) . -FICA taxes payable

Match each of the following terms with the appropriate definitions. -Gross pay less all tax and voluntary deductions.

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability) . -Payment of a 4-year term loan due this year

Match each of the following terms with the appropriate definitions. -Taxes that fund Social Security and Medicare,assessed on both employer and employees under the Federal Insurance Contributions Act.

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability) . -Salaries payable

Match the following items with the appropriate designation (Current liability, Long-term liability, or Not a liability) . -Payment of a 30-year term loan due next year.(The company's operating cycle is 2 months.)

Match each of the following terms with the appropriate definitions. -A seller's obligation to replace or correct a product or service that fails to perform as expected within a specified period.