Question

The following are True or False.

All intangibles must be amortized.

Internally generated goodwill is capitalized.

Gain contingencies and loss contingencies are both recorded in the general journal when it is probable that they will occur and can be reasonably estimated.

Amortization of a premium increases bond interest expense, while amortization of a discount decreases bond interest expense.

If the market rate equals the stated rate, bonds will be sold at face value.

A zero-interest-bearing note payable that is issued at a discount will not result in any interest expense being recognized.

Please answer the following

On which of the three important dates for a cash dividend is a liability incurred?

Answer 1

1. All intangibles must be amortized.----------FALSE

ALL INTANGIBLES ARE NOT AMORTIZED. INTANGIBLES ONLY WITH FINITE USEFUL LIVES ARE AMORTIZED.

2. Internally generated goodwill is capitalized.-----FALSE

INTERNALLY GENERATED GOODWILL IS NEVER CAPITALIZED

3.Gain contingencies and loss contingencies are both recorded in the general journal when it is probable that they will occur and can be reasonably estimated.--------FALSE

GAIN CONTINGENCIES ARE APEARED IN NOTES TO FINANCIAL STATEMENTS WHEN IT IS PROBABLE THAT THEY WILL OCCUR AND CAN BE REASONABLY ESTIMATED

4. Amortization of a premium increases bond interest expense, while amortization of a discount decreases bond interest expense.----FALSE

5. If the market rate equals the stated rate, bonds will be sold at face value-----TRUE

6. A zero-interest-bearing note payable that is issued at a discount will not result in any interest expense being recognized.-----FALSE

IT RESULTS IN INTEREST EXPENSE

pART B) cash dividend is a liability incurred ON ---------DATE OF DECLARATION