Match the following terms or phrases in (a–g) with the explanations in 1–8. Terms or phrases may be used more than once. Question 11 options: Current assets/Current liabilities Probable likelihood and estimable liability Measures the “instant” debt-paying ability of a company Current assets – Current liabilities (Cash + Temporary investments + Accounts receivable)/Current liabilities Cash + Temporary investments + Accounts receivable Probable likelihood of a liability but cannot be estimated Remote contingent liability Reasonably possible likelihood of a liability 1.Current ratio2.Working capital3.Quick assets4.Quick ratio5.Record an accrual and disclose in the notes to the financial statements6.Disclose only in notes to financial statements7.No disclosure needed in notes to financial statements

US GAAP defines contingent liabilities as: Any potential future loss that depends on a "triggering…

Answered: Match the following terms or phrases in…

Auditing: A Risk Based-Approach to Conducting a Quality Audit

10th Edition

ISBN:9781305080577

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter14: Activities Required In Completing A Quality Audit

Section: Chapter Questions

Problem 65RSCQ

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Match the following terms or phrases in (a–g) with the explanations in 1–8. Terms or phrases may be used more than once.

Question 11 options:

	Current assets/Current liabilities
	Probable likelihood and estimable liability
	Measures the “instant” debt-paying ability of a company
	Current assets – Current liabilities
	(Cash + Temporary investments + Accounts receivable)/Current liabilities
	Cash + Temporary investments + Accounts receivable
	Probable likelihood of a liability but cannot be estimated
	Remote contingent liability
	Reasonably possible likelihood of a liability

1.	Current ratio
2.	Working capital
3.	Quick assets
4.	Quick ratio
5.	Record an accrual and disclose in the notes to the financial statements
6.	Disclose only in notes to financial statements
7.	No disclosure needed in notes to financial statements

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