Obligations Not Expected to Be Paid Within the Longer of One

question 111

Multiple Choice

Obligations not expected to be paid within the longer of one year or the company's operating cycle are reported as:

• A) Current assets.
• B) Current liabilities.
• C) Long-term liabilities.
• D) Operating cycle liabilities.
• E) Bills.

---

Definitions:

Optimal Capital

The best mix of debt, equity, and other financing sources to maximize a firm’s value while minimizing its cost of capital.

Swaps

Financial derivatives where two parties agree to exchange cash flows or other financial instruments for a set period of time.

Currency Swaps

Bilateral agreements to exchange periodic payments where the payments are based in two different currencies.

Financial Intermediary

An institution that facilitates the channeling of funds between lenders and borrowers indirectly.