1) Which of the following is a financial instrument used by an entity to borrow money?
a) Bond
b) Check
c) Note Receivable
2) Camp Corporation issues bonds with a stated interest rate of 8%. The current market rate interest is 10% These bonds likely sold at:
a) per value
b) a discount
c) none of the above
3) A company issues a $2,000 6% note payable due un 4 months. How much interest will the company pay for this note?
a) $0
b)$30
c)$40
4) Which of the following statements is true?
i. A note payable can be classified as a current or long-term liability.
ii. Taxes payable are never current liabilities.
a) i only
b) ii only
c) both i and ii
5) When will long-term debt be considered a current liability?
a) never
b) always
c) whatever portion of the debt is due within one year of the balance sheet data will be considered current