Statement of Financial Position Paper 1

1

The primary purpose of the statement of financial position is to reflect






2

Prepaid expenses are valued on the statement of financial position at the






3

Dixon Company has the following items recorded on its financial records:
Available-for-sale securities .............$200,000
Prepaid expenses............................$400,000
Treasury stock................................$100,000
The total amount of the above items to be shown as assets on Dixon’s statement of financial position is






4

A statement of financial position allows investors to assess all of the following except the






5

Abernathy Corporation uses a calendar year for financial and tax reporting purposes and has $100 million of mortgage bonds due on January 15, Year 2. By January 10, Year 2, Abernathy intends to refinance this debt with new long-term mortgage bonds and has entered into a financing agreement that clearly demonstrates its ability to consummate the refinancing. This debt is to be






6

Lister Company intends to refinance a portion of its short-term debt in Year 2 and is negotiating a long-term financing agreement with a local bank. This agreement would be noncancelable and would extend for a period of 2 years. The amount of short-term debt that Lister Company can exclude from its statement of financial position at December 31, Year 1,






7

A statement of financial position is intended to help investors and creditors






8

A manufacturer receives an advance payment for special-order goods that are to be manufactured and delivered within the next year. The advance payment should be reported in the manufacturer’s current-year statement of financial position as a(n)






9

A cable television entity receives deposits from customers that are refunded when service is terminated. The average customer stays with the entity 8 years. How should these deposits be shown on the financial statements?






10

A company has outstanding accounts payable of $30,000 and a short-term construction loan in the amount of $100,000 at year end. The loan was refinanced through issuance of long-term bonds after year end but before issuance of financial statements. How should these liabilities be recorded in the balance sheet?






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