TRUE/FALSE
1.One essential attribute of a liability is that the obligation will require in a future outflow of cash.
2.The issue price of bonds is equal to the present value of the principal plus the present value of the interest.
3.A contingency must be reported as a liability if it possibly will result in a loss and the amount of the loss can be reasonably estimated.
4.When a firm leases a resource for most of its useful life and controls the resource as though it had been purchased, the lease is treated as an operating lease.
5.The direct investment made by stockholders in a corporation is
contributed capital.
6.Par value
is a nominal value assigned to each share of stock by a corporation.
7.The number of shares actually held by the stockholders are known as
authorized
shares.
8.Stock splits and stock dividends will result in a reduction of total stockholders' equity.
9.Dividends are a distribution of earnings, not an expense.
10.Preferred stock has a higher claim on dividends and assets than common stock.