Fundamental Accounting Principles 14th Canadian Edition Volume 2 By Larson-Test Bank

Test Bank: Fundamental Accounting Principles 14th Canadian Edition Volume 2 – Larson

1. A liability represents forthcoming payment of assets or services that a company currently must fulfill due to previous transactions or occurrences.
True False

2. Company obligations not anticipated to be settled within one year of the balance sheet date or the subsequent operating cycle are classified as current liabilities.
True False

3. All anticipated future payments are considered liabilities.
True False

4. An obligation emerges from past incidents, leading to future commitments requiring sacrifices.
True False

5. Long-term liabilities encompass company debts due for payment within a year.
True False

6. A long-term liability may encompass a current element.
True False

7. Initial recording of amounts received in advance from customers for forthcoming products or services is as liabilities.
True False

8. Trade accounts payable denote amounts owed to suppliers for goods or services obtained on credit.
True False

9. Unearned revenue is an alternate term for sales revenue.
True False

10. Debiting cash and crediting sales taxes payable occur when firms transfer collected sales taxes to the government.
True False

11. Known liabilities include measurable agreements, contracts, or legal obligations with minimal uncertainty.
True False

12. Before the basketball season commences, the Toronto Raptors record $6 million from season ticket sales as unearned season ticket revenue.
True False

13. Gross pay differs from net pay.
True False

14. Provincial Sales Tax Payable is imposed on sales to all end consumers of taxable goods.
True False

15. Wholesalers are exempt from paying Goods and Services Tax (GST).
True False

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