For a liability to exist, which one of the following criteria must be satisfied?

The obligation is a past obligation that exists as a result of future events.

The obligation is a present obligation that exists as a result of future events.

The entity has an obligation (that is, a duty or responsibility to others that it has no practical ability to avoid).

The obligation is a future obligation that exists as a result of past events.

2,Jackson Corporation has borrowed $2 million from a local bank under a long-term debt agreement whereby the loan has to be repaid in two years' time. The agreement was violated and the debt became payable on demand. As a result, the loan was reported as a current liability in Jackson's statement of financial position (SFP). Prior to the release of the statement, the bank agreed that it would not demand repayment. Assuming Jackson reports under IFRS, the loan

could be reclassified from a current liability to a long-term liability.

would continue to be shown as a current liability in the SFP.

could be reclassified from a current liability to equity.

would have to be repaid prior to the release of the SFP.

3.A liability for compensated absences is

recognized in the year in which it is earned by employees whenever a reasonable estimate can be made of amounts expected to be paid out in the future.

accrued only if specific conditions are met.

disclosed in a note only.

never accrued but may be disclosed if desired.

4.Under the revenue approach to accounting for product guarantees, the liability is

recognized at the value of the service to be provided.

recognized at the estimated present cost of the service to be provided.

recognized at the estimated future cost of the service to be provided.

not recognized.