Select the necessary words from the list of possibilities to complete the following statements.

Select the necessary words from the list of possibilities to complete the following statements. Answer is complete and correct. Statements Answer 1. The formal document creating bonded indebtedness is called the trust indenture (indenture) 2. If violation of a debt provision makes a debt payable on demand, the debt must be classified as a current liability unless a is obtained from the trustee or the financial institution. waiver of compliance 3. To continue to classify a maturing debt as a long-term liability, the client must demonstrate both the to refinance the debt. intent and the ability > 4. Unamortized should be added to the face amount of the bonds or debentures in the liability section of the balance sheet. premium o 5. Internal control over the payment of dividends is enhanced when the company utilizes the services of an independent dividend paying agent The primary responsibility of the independent stock corporation. is to avoid any over-issuance of stock of the 6. registrar 7. The number of shares of stock issued and outstanding at the balance sheet date may be confirmed by direct communication with both the registrar and the transfer agent o 8. For a continuing audit client, the audit of retained earnings often consists of determining that the net income was added to the beginning balance and that the were subtracted. dividends o 9. vouching In the audit of interest-bearing debt, the auditors' primary substantive procedures will include transactions occurring during the period to available support. In the audit of interest-bearing debt, the auditors confirm balances and terms and examine the 10. debt agreements 11. The of the corporation normally require that borrowing be approved by the board of directors. bylaws