Select one of the prompts below and write an initial post.

Chapter 12 options:

1. Why is Accounts Payable classified as a current liability?
2. What are the two FASB required conditions for a contingent liability to be recognized?
3. What business circumstance could bring about a short-term note payable created from a purchase? Explain.
4. What business circumstance could produce a short-term notes payable created from a loan? Explain.

Chapter 13 options:

1. How are savings bonds different from a corporate bond?
2. Does issuing a bond at a discount increase or decrease interest expense over the life of the bond? Explain.
3. Why is the effective-interest method of amortization required under the International Financial Reporting Standards?
4. Does interest expense increase or decrease when a bond premium is amortized? Explain.

Chapter 14 options:

1. Your corporation needs additional capital to fund an expansion. Discuss the advantages and disadvantages of raising capital through the issuance of stock. Would debt be a better option? Why or why not?
2. Why would a company repurchase its own stock? Provide at least two examples.
3. What types of transactions reduce owners equity? What types of transactions reduce retained earnings? What do they have in common?
4. Should investors rely on EPS as an investing tool? Why or why not?

Chapter 16 options:

1. Is it possible for a company to have significant net income in the same time period that net cash flows are negative? Explain.
2. Explain the difference between the two methods used to prepare the operating section of the statement of cash flows. How do the results of these two approaches compare?
3. Why is depreciation an addition in the operating section of the statement of cash flows, when prepared by the indirect method?
4. When preparing the operating section of the statement of cash flows, using the indirect method, how must gains and losses be handled? Why?
5. Why is using the direct method to prepare the operating section of the statement of cash flows more challenging for accountants than preparing the balance sheet, income statement, and retained earnings statement?