chapter 9 slides

Question 1

liabilities labeled by due dates

Answer 1

short term liabilities and long term liabilities

Question 2

short term liabilities

Answer 2

due within one year

Question 3

long term liabilities

Answer 3

due in more than one year

Question 4

liabilities labeled by origin

Answer 4

-monetary liabilities
-non-monetary liabilities

Question 5

monetary liabilities

Answer 5

money is actually owed and must be paid

Question 6

non monetary liabilities

Answer 6

-no money is actually due (eg unearned revenue and deferred taxes)

Question 7

accounts payable sually from

Answer 7

purchase of inventory and have not payed for it yet

Question 8

current liabilities are

Answer 8

-account oayable
-rent payabke
-taxes payable
-warrenty liabilities
-payroll taxes payable
-accrued expenses

Question 9

notes payable

Answer 9

-the other side of notes receivable

Question 10

simple interest requires no

Answer 10

compounding

Question 11

what do you have to make sure you divide interest by

Answer 11

by year amount because interest rate is on annual basis

Question 12

debt ratio tells us

Answer 12

how risky company is/how close to insolvency they are

Question 13

know current ratio (ch 2)

Answer 13

ok

Question 14

know debt to asset ratio (ch 2)

Answer 14

ok

Question 15

what does EBIT stand for

Answer 15

EBIT stands for earnings before interest and taxes, and is a key metric used in accounting to measure a company’s operating profitability:

Question 16

EBIT is calculated by

Answer 16

revenue minus expenses excluding tax and interest