ADMS 3595 Lecture Notes - Lecture 1: Current Liability, Cash Method Of Accounting, Current Asset

• School: York University
• Department: Administrative Studies
• Course: ADMS 3595
• Professor: Sandra Iacobelli

Document Summary

Exercise 13-1 (a) classifications on balance sheet prepared under aspe: Current liability or long-term liability depending on term of warranty; not a financial liability. A company would have an obligation to pay cash to the bank for any overdraft and this would result from the contractual agreement with the bank. Current liability; not a financial liability if this refers to legal obligations for income tax withholdings, cpp and ei. This is a financial liability if it refers to other withholdings of a contractual nature with employees (union dues, for example). Current or noncurrent liability depending upon the time involved; not a financial liability (if deposit will be returned then it would be a financial liability). Dividends in arrears have not been declared so it cannot be a financial liability. It becomes a financial liability only when declared by the company.