Question

1. Liabilities a. cannot be estimated.

b. are shown on the left side of the = sign in the basic accounting equation.

c, may also be thought of as creditors’ claims against the assets of the business.

d. include amounts that are paid by the business in advance of a service that is to be provided to the business.

2. A written promise to pay a specified amount on a stated future date within one year is a ______________ (long, short, mid)-term note payable.

3. IRS Form 951 is a payroll report that is filed with the Internal Revenue Service. a. Yes b. No

Answer 1

1. The correct answer is "C" : may also be thought of as creditors' claims against the assets of the business.

(Liabilities are obligations of the company or the amount owed by the company to third parties in respect of services/goods received from them. Hence they can also be thought of as a creditor's claims against the assets of the business)

2. A written promise to pay a specified amount on a stated future date within one year is a short-term note payable.

(Any obligation to be paid within one year is a short-term obligation)

3. No, IRS Form 951 is not the payroll report which is filed with IRS. It is IRS Form 941 which is filed with IRS as a payroll report.