Quiz Review Week 5

Week 5 Quiz Review – Chapter 13 Here are the topics covered on the quiz. You should know the following: 1. Reporting and accounting for contingent liabilities, including settlement of IRS dispute as a subsequent event (but prior to financial statements being issued) 2. Levels of “remote” or “reasonably” possible, vs. “probable”, and treatment of a loss contingency under each of these scenarios 3. Condition under which a contingent loss should be reported in a footnote rather than being accrued 4. Reporting liability for coupons if know experience ratio of redemption and potential number outstanding 5. Computing accrued interest due on a Note Payable 6. Determining interest expense if know change in interest payable account and amount paid during the year. (Hint: Think about the activity in the interest payable account and algebraically solve for the one variable missing) 7. Same as #6 – but for warranty liability account – what were warranty expenditures for the year 8. Calculating effective interest rate on a noninterest bearing note, knowing stated rate, term and maturity value 9. Determining carrying value of a noninterest bearing note, knowing discount rate 10.How to classify collateralized Notes Payable as to their current and long-term portions. (Hint: “refinancing ability” is a factor)