Chapter 14 Accounting 26e Carl Warren James M Reeve Jonathan Duchac

Chapter 14 Accounting 26e Carl Warren James M Reeve Jonathan Duchac

Complete Chapter Questions With Answers

Sample Questions Are Posted Below

1. A bond is simply a form of an interest-bearing note.
   1. True
   2. False

ANSWER:                                  True

DIFFICULTY:                           Easy

Bloom’s: Remembering

LEARNING OBJECTIVES:        ACCT.WARD.16.14-01 – 14-01

ACCREDITING STANDARDS:   ACCT.ACBSP.APC.22 – Long-Term Liabilities Reporting

ACCT.AICPA.BB.01 – Industry

ACCT.AICPA.FN.03 – Measurement BUSPROG: Analytic

2. Bondholders are creditors of the issuing corporation.
   1. True
   2. False

ANSWER:                                  True

DIFFICULTY:                           Easy

Bloom’s: Remembering

LEARNING OBJECTIVES:        ACCT.WARD.16.14-01 – 14-01

ACCREDITING STANDARDS:   ACCT.ACBSP.APC.22 – Long-Term Liabilities Reporting

ACCT.AICPA.FN.03 – Measurement BUSPROG: Analytic

3. Bondholders claims on the assets of the corporation rank ahead of stockholders.
   1. True
   2. False

ANSWER:                                  True

DIFFICULTY:                           Easy

Bloom’s: Remembering

LEARNING OBJECTIVES:        ACCT.WARD.16.14-01 – 14-01

ACCREDITING STANDARDS:   ACCT.ACBSP.APC.22 – Long-Term Liabilities Reporting

ACCT.AICPA.BB.01 – Industry

ACCT.AICPA.FN.03 – Measurement BUSPROG: Analytic

4. A bond is usually divided into a number of individual bonds of $500 each.
   1. True
   2. False

ANSWER:                                  False

DIFFICULTY:                           Easy

Bloom’s: Remembering

LEARNING OBJECTIVES:        ACCT.WARD.16.14-02 – 14-02

ACCREDITING STANDARDS:   ACCT.ACBSP.APC.22 – Long-Term Liabilities Reporting

ACCT.AICPA.FN.03 – Measurement BUSPROG: Analytic

5. If the bondholder has the right to exchange a bond for shares of common stock, the bond is called a convertible
   1. True
   2. False

ANSWER:                                  True

DIFFICULTY:                           Easy

Bloom’s: Remembering

LEARNING OBJECTIVES:        ACCT.WARD.16.14-02 – 14-02

ACCREDITING STANDARDS:   ACCT.ACBSP.APC.22 – Long-Term Liabilities Reporting

ACCT.AICPA.FN.03 – Measurement BUSPROG: Analytic