1. A short-term obligation can be excluded from current liabilities if the company intends to refinance it on a long-term basis and demonstrates the ability to consummate the refinancing. A) True B) False 2. Companies should recognize the expense and related liability for compensated absences in the year earned by employees. A) True B) False 3. Among the short-term obligations of Larsen Company as of December 31, the balance sheet date, are notes payable totaling $250,000 with the Dennison National Bank. These are 90-day notes, renewable for another 90-day period. These notes should be classified on the balance sheet of Larsen Company as A) current liabilities. B) deferred charges. C) long-term liabilities. D) intermediate debt. 4. Of the following items, the only one which should not be classified as a current liability is A) current maturities of long-term debt. B) sales taxes payable. C) short-term obligations expected to be refinanced. D) unearned revenues.