Consider the Following Items

question 42

Multiple Choice

Consider the following items:
Land
Accounts Receivable
Notes Payable (due in three years)
Accounts Payable
Retained Earnings
Prepaid Rent
Unearned Revenue
Buildings
Notes Payable (due in six months)
Equipment
How many of the items listed above are generally long-term assets?

• A)Two.
• B)Three.
• C)Four.
• D)Five.

---

Definitions:

Bond Discount

The amount by which the market price of a bond is lower than its principal amount or face value.

Indirect Method

A method used in cash flow statement preparation that adjusts net income for items that affected reported net income but didn't affect cash.

Operating Activities

Activities directly related to the production, sale, and delivery of a company's goods or services, reflecting its core business operations.

Indirect Method

A way of calculating cash flows from operating activities in the cash flow statement by adjusting net income for changes in non-cash accounts.