year-end but before issuance of financial statements. How should these liabilities be recorded in the balance sheet?
13. Bonds payable issued with scheduled maturities at various dates are called
14. A loss contingency for which the amount of loss can be reasonably estimated should be accrued when the occurrence of the loss is
15. On October 1, year 1, Fleur Retailers signed a 4-month, 16 % note payable to finance the purchase of holiday merchandise. At that date, there was no direct method of pricing the merchandise, and the note’ s market rate of interest was 11 %. Fleur recorded the purchase at the note’ s face amount. All of the merchandise was sold by December 1, year 1. Fleur’ s year 1 financial statements reported interest payable and interest expense on the note for 3 months at 16 %. All amounts due on the note were paid February 1, year 2. As a result of Fleur’ s accounting treatment of the note, interest, and merchandise, which of the following items was reported correctly?
16. Agee Corp. pays its outside salespersons fixed monthly salaries and commissions on net sales. Sales commissions are computed and paid on a monthly basis( in the month following the month of the sale), and the fixed salaries are treated as advances against commissions. However, if the fixed salaries for salespersons exceed their sales commissions earned for a month, such excess is not charged back to them. Pertinent data for the month of April year 2 for the three salespersons in sales region 330 are as follows:
17. For sales region 330, what total amount should Agee accrue for sales commissions payable at April 30, year 2?
18. On January 1, a company issued a $ 50,000 face value, 8 % fiveyear bond for $ 46,139 that will yield 10 %. Interest is payable on June