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A contingent liability is a potential obligation that depends on a future event arising from a past transaction or event.

Marks Consulting purchased equipment costing $45,000 on January 1, Year 1. The equipment is estimated to have a salvage value of $5,000 and an estimated useful life of 8 years. Straight-line depreciation is used. If the equipment is sold on July 1, Year 5 for $20,000, the journal entry to record the sale will include a:

A company has advance subscription sales totaling $45,000 for the upcoming year when four quarterly journals will mailed to customers. When the company mails the first quarterly journal to customers, it should record:

When the contract rate on a bond issue is less than the market rate, the bonds sell at a discount.

A premium reduces the interest expense of a bond over its life.

The cost of fees for insuring the title and any accrued property taxes are included in the cost of land.

The specific meaning of goodwill in accounting is:

A bond’s par value is not necessarily the same as its market value.

The units-of-production method of depreciation charges a varying amount of expense for each period of an asset’s useful life depending on its usage.

A bond is an issuer’s written promise to pay an amount identified as the par value of the bond along with periodic interest payments.