Which of the Following Statements Is Correct

question 86

Multiple Choice

Which of the following statements is correct?

• A) A company may exclude a short-term obligation from current liabilities if the firm intends to refinance the obligation on a long-term basis.
• B) A company may exclude a short-term obligation from current liabilities if the firm can demonstrate an ability to consummate a refinancing.
• C) A company may exclude a short-term obligation from current liabilities if it is paid off after the balance sheet date and subsequently replaced by long-term debt before the balance sheet is issued.
• D) None of these answers are correct.

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Definitions:

State Legislative Power

The authority granted to state legislatures to enact laws, amend, or repeal them within their respective states.

Congressional Powers

The authority granted to the U.S. Congress by the Constitution, including making laws, declaring war, and regulating interstate and foreign commerce.

Concurrent Powers

Powers held and exercised by both federal and state governments simultaneously under a federal system of governance, such as the power to tax or build roads.

Commerce Clause

A provision in the U.S. Constitution giving Congress the power to regulate commerce with foreign nations, among the states, and with Native American tribes.