1) Which of the following is NOT true of a liability? a) It is a probable, future sacrifice of economic benefits. 5) It must be satisfied by paying cash in the future. c) It arises from a present obligation to other entities. d) It results from a past transaction or event. 2) Which amount would NOT be reported as a current liability on the balance sheet? a) Long-term bonds of $500,000 callable by the creditor in the upcoming year (b) Non-callable $1,000,000 bonds with detachable warrants c) Advance collections from customers of $6,100 d) Refundable deposits $10,400 3) Ferguson Corporation issued $8,000,000, 10-year bonds with a stated rate of 7%. Six years later, Ferguson no longer needed the money and redeemed the bond and paid back the bondholders, indicating that the bond was a) A zero-coupon bond b) Convertible c) A serial bond d) Callable 4) Which of the following would be reported on a company's financial statements (other than in the notes)? Ca) A probable contingent loss where the amount is readily determinable b) A probable contingent gain where the amount is readily determinable c) A possible contingent loss where the amount is readily determinable d) A probable contingent loss where the amount is not readily determinable 51 McMillan Company issued a $300,000 bond with a state rate of 8%. Which of the following is possibility in terms of cash received when the bond was issued? a) McMillan Company received $263,700. The effective/market interest rate was 7% b) McMillan Company received $272,900. The effective/market interest rate was 9% s McMillan Company received $344,100. The effective/market interest rate was 8% d) McMillan Company received $327,500. The effective/market interest rate was 10%