Which One of the Following Statements Is False

question 51

Multiple Choice

Which one of the following statements is false?

• A)Short-term obligations may be classified as long-term if the company intends to refinance them on a long-term basis and can demonstrate the ability to do so.
• B)Violation of a long-term debt covenant automatically means the company must reclassify the debt as current.
• C)Current liabilities are recorded at their maturity value, and not their present value.
• D)If a bond is issued at a discount the effective interest rate is greater than the coupon rate.

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Definitions:

Total Force

The sum of all forces acting on an object, determining the object's acceleration according to Newton's second law.

Right-Hand Rule

A mnemonic device used to determine the direction of certain vectors in physics, notably in electromagnetism, where the thumb, index, and middle finger each represent different vectors.

North Pole

One of the two points on the Earth where the planet's magnetic field lines converge, historically thought of as the top of the magnetic field.

Electromagnet

A type of magnet whose magnetic field is produced by the flow of electric current, typically wrapped around a core of ferromagnetic material.