example of an item which is NOT a liability is 53) The covenants and
other terms of the agreement between the issuer of bonds and the lender
are set forth in the 54) Bonds for which the owners' names are NOT
registered with the issuing corporation are called 55) Minimum lease
payments may include a 56) What impact does a bargain purchase
option have on the present value of the minimum lease payments
computed by the lessee? 57) Which of the following is a correct
statement of one of the capitalization criteria? 58) In order to properly
record a direct-financing lease, the lessor needs to know how to
calculate the lease receivable. The lease receivable in a direct-financing
lease is best defined as 59) In the earlier years of a lease, from the
lessee's perspective, the use of the 60) In a lease that is appropriately
recorded as a direct-financing lease by the lessor, unearned income SET
3 1) Which of the following is NOT considered cash for financial
reporting purposes? 2) What is the preferable presentation of accounts
receivable from officers, employees, or affiliated companies on a
balance sheet? 3) Which of the following items should NOT be included
in the Cash caption on the balance sheet? 4) The advantage of relating a
company's bad debt expense to its outstanding accounts receivable is
that this approach 5) Which of the following is a generally accepted
method of determining the amount of the adjustment to bad debt
expense? 6) Assuming that the ideal measure of short-term receivables
in the balance sheet is the discounted value of the cash to be received in
the future, failure to follow this practice usually does NOT make the
balance sheet misleading because 7) Eller Co. received merchandise on
consignment. As of January 31, Eller included the goods in inventory,
but did NOT record the transaction. The effect of this on its financial
statements for January 31 would be 8) If the beginning inventory for
2006 is overstated, the effects of this error on cost of goods sold for
2006, net income for 2006, and assets at December 31, 2007,
respectively, are 9) The accountant for the Orion Sales Company is
preparing the income statement for 2007 and the balance sheet at
December 31, 2007. Orion uses the periodic inventory system. The
January 1, 2007 merchandise inventory balance will appear 10) The use
of a Discounts Lost account implies that the recorded cost of a