All of Definitions of the financial failure confirm the project's inability to pay itscurrent and noncurrent obligations on the due date.trueFalse

solution concept financial failure Financial failure refer to the situation where…

Answered: All of Definitions of the financial…

All of Definitions of the financial failure confirm the project's inability to pay it current and noncurrent obligations on the due date. O true O False

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 5Q

See similar textbooks

Related questions

Q: Which of the following statements is true regarding capitalization of interest? O When excess…

A: The cost of borrowing to acquire or build a long-term asset is referred to as capitalized interest.…

Q: Based on the requirements and guidance of IFRS 15, one of the following is not considered part of…

A: Under the contract costing, there is an agreement made between two parties in respect of performing…

Q: If in subsequent period, there is objective evidence of recovery in impairment previously recognized…

A: If previously Amortized debt measured by amortised cost has been recognized as debt in equity…

Q: The following statements relate to the depreciation of property, plant and equipment. Which…

A: Lets start with basic understanding. Depreciation is a reduction in value of asset due to wear and…

Q: Which of the following statements is false? a. The monetary unit assumption is used under IFRS.…

A: International Financial Reporting Standards (IFRS): IFRS is a set of international accounting…

Q: f the Construction in Progress account is greater than the Contract Billings, the excess is treated…

A: Construction in progress means the contracts' work which still going on and is yet to be completed.

Q: Which of the following statements about contingent liabilities is incorrect? Group of answer choices…

A: A contingent liability is a potential liability that may arise in the future, such as unresolved…

Q: Which one of the following statement about encumbrance is correct? a. Encumbrances are equivalent to…

A: Encumbrances denote the estimated expenditures before the actual expenditure is occurred. It…

Q: When is an estimated loss on a long-term contract recognized, both for contracts that recognize…

A: Revenue recognized point of long term contract: A long-term contract qualifies for revenue…

Q: Which of the following statements is not applicable to contract acquisition costs under ASC Topic…

A: In the given case all of the following statements is applicable to contract acquisition costs under…

Q: Capitalization of borrowing costs * Shall be suspended only during extended periods of delays…

A: Borrowing costs are those costs incurred that are attributable to construction, production of any…

Q: When it is probable that total contract costs will exceed total contract revenue, how shall the…

A: SOLUTION CONTRACT COST IS THE TRACKING OF COSTS ASSOCIATED WITH A SPECIFIC CONTRACT WITH A CUSTOMER…

Q: Which of the following is not a factor that limits the service life of an asset? a. Operational use…

A: Service life can be limited due to physical causes and functional causes such as deterioration,…

Q: Which of the following concept states that "the organization should account for all possible…

A: Owner's equity includes the capital invested by the owners of the company and the retained earnings.…

Q: At the temporary financial hardship stage, the company is unable to pay its due obligations,…

A: Liquidity means ability of the business to pay its short-term liabilities. Inability to pay-off…

Q: Which of the following is not a condition that must be satisfied before interest capitalization can…

A: Capitalized Interest: Interest is usually paid on the amount borrowed and it is shown as an expense…

Q: Which of the following is not a condition that must be satisfied before interest capitalization can…

A: Option b is the correct answer because the other three options are the conditions that should be…

Q: Determine if this shall result in recognition of liabilities 13. violation of the terms of a…

A: A liability is a obligation of entity which requires outflow of resources of entity for its…

Q: apitalization of borrowing cost Shall be suspended during temporary period of delay. May be…

A: Borrowing cost means where the assets like building , take substantial time to build , then interest…

Q: A provision shall be recognized when except * it is probable that an outflow of resources embodying…

A: A provision is an account set off for any obligation which can occur in future. In other words, a…

Q: Any anticipated loss should be recognized * A.on a percentage basis during the contract period B.…

A: The amount of anticipated loss is calculated regardless of: (a) whether or not work on the contract…

Q: Which of the following is not part of the definition of an asset O a. Control of a resource O b.…

A: Asset can be defined as a resource controlled by the entity as a result of past events from which…

Q: age of time B. Completion of percentage of a project C. Performan

A: Revenue refers to the sum value of money gained by a business by selling its goods or services in…

Q: True or false _________ Costs incurred that are directly attributable to the acquisition of a PPE…

A: Answer

Q: operator treats the resurfacing services included in a service concession arrangement as a separate…

A: service concession arrangement where government or any other public sector body contract with the…

Q: Determine if this shall result in recognition of liabilities 12. violation of the terms of a…

A: As per IAS 37 of IFRS Provisions, contingent liabilities and contingent assets A Provision is a…

Q: Which of the following does not require disclosure in the financial statements? choices: There is…

A: Disclosure in Financial statement Disclosure in the financial statement which is described as…

Q: What is the difference between the assignment of a take-out commitment to the construction lender…

A: Take-out commitment is an agreement between lender and borrower in which lender provides guarantee…

Q: When the outcome of a construction contract cannot be estimated reliably, how shall contract revenue…

A: when the outcome of a construction contract can be estimated reliably, contract revenue and contract…

Q: Which of the following cases would result in an actuarial loss? Projected benefit obligation…

A: As per IFRS, Actuarial gains and losses are changes in the present value of the defined benefit…

Q: . Must be expensed in the period incurred unless it can be clearly demonstrated that the expenditure…

A: IASB stands for International Accounting Standards Board and helps in the preparation and issuance…

Q: When outcome of a construction contract is estimated reliably, contract revenue and contract costs…

A: Solution: As per IAS 11, "when the outcome of a construction contract can be estimated reliably,…

Q: Which of the following is correct about subsequent measurement of financial asset at fair value? a.…

A: Fair value through other comprehensive income-financial assets are classified and measured at fair…

Q: Which of the following does not require disclosure in the financial statements? There is a…

A: Contingent Liability is a possible obligation that depends on future uncertain events, or is a…

Q: I. The costs of uninsured hazards or claims for uninsured accidents during construction are regarded…

A: Assets are the resources of the entity for which the company or the individual has ownership. They…

Q: A statement of affairs measures a deficiency – traceable to unsecured creditors without priority –…

Q: When it is probable that total contract costs will exceed total contract revenue, how shall the…

A: IAS 11 prescribes the contractor’s accounting treatment of revenue and costs associated with…

Q: When it is probable that total contract costs will exceed total contract revenue, how shall it be…

A: Contract account is prepared when the work to be done take substantial time to make (generally more…

Q: why is there a need to re evaluate impairment of assets due to trigger events?

A: The impairment refers to the decrease in the value of assets of the company. This reduction is…

Q: What serious consequences occur in an inaccurate estimate of asset needs?

A: Estimates of assets: It is approximate value of assets of original value of assets which is used…

Q: Which of the following journal entries is not made in the first period of a long-term contract if…

A: In case of long term contract , we can show proportionate profit every year depending on following…

Q: In which of the following instances is the capitalization of borrowing costs suspended? a. during…

A: All the borrowing cost that is directly associated with the acquisition or construction of a…

Q: When percentage-of-completion accounting is not appropriate, U.S. GAAP requires the use of the…

Q: excluded costs from the amortization base for a full cost company?

A: Meaning of Full Cost It is a method, used by oil and natural gas companies where no differentiation…

Concept explainers

Contract Costing

Contract costing is about tracing particular costs related to a particular contract entered into with the customer. It is one of the forms of job order costing. It is useful in long-term contracts at the most. It is seen that substantial time is required for the completion of the contract which takes different accounting periods. Thus, it is very much helpful for recognizing the costs associated with it and accounting in their specific accounting periods.

Question

All of Definitions of the financial failure confirm the project's inability to pay its
current and noncurrent obligations on the due date.
true
False

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Which statement is true when the outcome of construction contract cannot be estimated reliably? a. Contract costs shall be recognized as an expense in the period when incurred. b. Revenue shall be recognized only to the extent of contract costs incurred that is probable will be recoverable c. All of these statements are true. d. An expected loss on the construction contract shall be recognized as an expense immediately.
Which of the following is a false statement regarding revaluation of PPE?A. Revalued amount is either fair value or depreciated replacement cost.B. If simultaneous revaluation is not possible, revaluation can be done on arolling basis provided revaluation of the class of assets is completed withina short period of time and provided the revaluations are kept up to date.C. The difference between the PPE’s carrying amount and its revalued amount isknown as revaluation surplus and should be presented in the statement ofcomprehensive income, net of applicable tax.D. When an asset's carrying amount is increased as a result of revaluation, theincrease shall always be credited to revaluation surplus regardless of theexistence of previous impairment loss recognized. Which of the following should be included as cost of inventory?A. Depreciation expense of the delivery equipment.B. Depreciation expense of the factory machinery.C. Storage cost of finished goods.D. None from the choices. In…
Which statement is incorrect in the measurement of a provision? *a. The risks and uncertainties that inevitably surround many events and circumstances shall be taken into account in reaching the best estimate of a provisionb. Where the effect of the time value of money is material, the amount of a provision shall be the present value of the expenditure expected to settle the obligationc. Future events that may affect the amount required to settle the obligation shall be reflected in the amount of the provision where there is sufficient objective evidence that the future events will occurd. Gains from expected disposal of assets shall be taken into account in measuring a provision
All of the following are examples of nonfinancial measures except: a.working capital. b.number of failed inspections. c.setup time. d.lead time.
Which of the following is not an accepted basis for recognition of revenue?A. Passage of timeB. Completion of percentage of a projectC. Performance of serviceD. Upon signing of contract
When percentage-of-completion accounting is not appropriate, U.S. GAAP requires the use of the completedcontract method, while IFRS requires the use of the cost recovery method. Explain how the two methods affectrecognition of revenue, cost of construction, and gross profit over the life of a profitable contract.
Discuss the implications of a misstated useful life of a category of capital equipment. What steps would you take to amend the error to reconcile the figures with other accurate financial statements?
MCQ: Choose only the correct answer Which of the following statements is false? (a) Financial Instruments are intangible assets (b) Goodwill is not amortizable (c) Goodwill can be identified only in business combination situation (d) Straightline method is generally used to calculate amortazation Which of the following will not be considered while calculating the depletion base? (a) Acquisition costs (b) Tangible development costs (c) Restoration Costs (d) Intangible development costs Which of the following will not be included into the the original cost of a land? (a) Legal fees (b) Brokers' commision (c) Property taxes (D) Accrued property taxes of previous owner The journal entry to record the transportation cost paid by the purchaser under periodic inventory system is- (a) Inventory Dr. and Cash Cr. (b) Transportation-in Dr. & Cash Cr. (c) Delivery Expense Dr. & Cash Cr. (d) Transportation-Out Dr. & Cash Cr. In case of change in estimate of useful life for a tangible…
Which of the following cases would result in an actuarial loss? Projected benefit obligation decreased. Projected benefit obligation increased. Fair value of plan assets increased. Fair value of plan assets decreased.
Which of the following does not require disclosure in the financial statements? choices: There is a present obligation that probably requires an outflow of resources that can be measured reliably. There is a present obligation that probably requires an outflow of resources but the amount cannot be measured reliably. There is a possible obligation or a present obligation that may, but probably will not require an outflow of resources There is a possible obligation or a present obligation where the likelihood of an outflow of resource is remote.
How should research and development costs be accounted for, according to an IASB Statement? a. Must be capitalized when incurred and then amortized over their estimated useful lives. b. Must be expensed in the period incurred. c. May be either capitalized or expensed when incurred, depending upon the materiality of the amounts involved. d. Must be expensed in the period incurred unless it can be clearly demonstrated that the expenditure will have alternative future uses or unless contractually reimbursable.
Which of the following does not require disclosure in the financial statements? There is a present obligation that probably requires an outflow of resources that can be measured reliably. There is a present obligation that probably requires an outflow of resources but the amount cannot be measured reliably. There is a possible obligation or a present obligation that may, but probably will not require an outflow of resources There is a possible obligation or a present obligation where the likelihood of an outflow of resource is remote.