Under IFRS, what is the term used for liabilities of uncertain timing or amount, such as warranties?
Explanation
This question tests knowledge of specific IFRS terminology for liabilities that have uncertain timing or amount, a key difference from GAAP highlighted on page 687.
Other questions
According to the textbook, long-term liabilities are defined as obligations that a company expects to pay:
Bonds that are issued against the general credit of the borrower and are not backed by specific collateral are known as:
The rate of interest that investors demand for loaning funds to a corporation is referred to as the:
When the contractual interest rate is lower than the market interest rate, bonds will sell:
On January 1, 2017, Candlestick, Inc. sells $100,000, five-year, 10 percent bonds for $98,000. How should this be recorded?
The carrying value of bonds is determined by which of the following calculations?
When a company redeems bonds at a price below the bond's carrying value, the result is a:
When convertible bonds are converted into common stock, how does the issuing company record the transaction?
Porter Technology Inc. issues a $500,000, 8 percent, 20-year mortgage note. The terms provide for annual installment payments of $50,926. What is the reduction in principal for the first payment?
Which of the following is NOT a condition that requires a lessee to record a lease as a capital lease?
What does the debt to assets ratio measure?
Kellogg Company reported total liabilities of $8,925 million, total assets of $11,200 million, interest expense of $295 million, income taxes of $476 million, and net income of $1,208 million. What is its times interest earned ratio?
Which of the following is considered an advantage of bond financing over common stock?
Under the straight-line method of amortization for a bond discount, what is the effect on annual interest expense?
Using the effective-interest method, if bonds are sold at a premium, the amount of interest expense each period:
Ramos Co. exchanges equipment with a book value of $42,000 and a fair value of $26,000, plus $17,000 cash, for a new semi-truck. The transaction has commercial substance. What is the cost of the new semi-truck?
What is the primary difference between an operating lease and a capital lease?
If a company issues $500,000 of 10 percent, 5-year bonds at 96 using the straight-line method, what is the annual interest expense?
If a company issues $800,000 of 9 percent, 5-year bonds at 104 using the straight-line method, what is the carrying value of the bonds after the first year?
What is a key difference between IFRS and GAAP regarding the accounting for convertible bonds?
Under the effective-interest method of amortization for a bond discount, the amount of interest expense recorded each period:
The carrying value of a bond will increase over its life if the bond was issued at:
What is the primary purpose of a sinking fund bond?
Mark Express Delivery exchanges old equipment with a book value of $12,000 and a fair value of $19,000, plus $3,000 cash, for new equipment. The transaction has commercial substance. What is the recorded cost of the new equipment?
What is the gain or loss on the disposal of the old equipment for Mark Express Delivery in the previous question?
If a company uses the straight-line method to amortize a bond premium, the journal entry to record the accrual of interest includes a:
What is the primary objective of GAAP requiring companies to use the effective-interest method of amortization when it is materially different from the straight-line method?
A company retires its $500,000 face value bonds by paying $515,000 in cash. At the time of retirement, the unamortized premium is $8,000. What is the gain or loss on redemption?
The practice of keeping lease liabilities off the balance sheet is known as:
Which of the following would NOT be included in the entry to record an installment payment on a mortgage note?
In the Candlestick, Inc. example where bonds were issued at a discount, the total cost of borrowing was:
If a bond is retired at maturity, the entry includes a debit to Bonds Payable and a credit to Cash for what amount?
An exchange of plant assets is said to have commercial substance if:
What is a primary reason for a company to report long-term liabilities in a separate section from current liabilities on the balance sheet?
Which method of amortizing a bond premium will result in varying amounts of interest expense per period?
Candlestick, Inc. issues $100,000, 5-year, 10 percent bonds for $102,000. Using the straight-line method, what is the bond premium amortization for each interest period?
In the bond amortization schedule for a bond issued at a discount using the effective-interest method, which column decreases each period until it reaches zero at maturity?
According to IFRS, how are the proceeds from a convertible bond accounted for?
What is the term IFRS uses instead of 'salvage value'?
What does a call feature on a bond allow the issuing company to do?
If a company uses the effective-interest method to amortize a bond discount, the entry to record accrued interest includes a:
The total cost of borrowing for bonds issued at a premium is calculated as:
Which condition would require a lease to be classified as a capital lease?
If a company has a debt to assets ratio of 79.7 percent, it means that:
What is the formula for calculating Times Interest Earned?
In an exchange of plant assets with commercial substance that results in a loss, the journal entry includes a:
Under IFRS, how does the accounting for revaluation of property, plant, and equipment differ from GAAP?
In the bond amortization schedule for a bond issued at a premium using the effective-interest method (Illustration 15B-4), what happens to the bond's carrying value each period?
What is the primary reason a company would choose to finance a major project with bonds instead of stock, as illustrated by Microsystems, Inc. on page 659?