Response to the following questions:
1. Hewlett-Packard reported $1,494 million of product warranties in the current liabilities section of a recent balance sheet. How would costs of repairing a defective product be recorded?
2. What is the number of times interest charges are earned if the business has net income before taxes of $600,000 and a $1,500,000 face value bond payable with a coupon rate of 10%?
3. What two types of transactions cause most current liabilities?
4. When are short-term notes payable issued?