Refer to RadioShack Corporation’s consolidated financial statements in Appendix B at the end of this book. These financial statements report a number of liabilities.

1. The current liability section of RadioShack Corporation’s Consolidated Balance Sheet as of December 31, 2010, lists four different liabilities. List them and give a brief description of each.

2. RadioShack Corporation’s largest single current liability is “accrued expenses and other current liabilities.” Refer to Note 3 entitled “Supplemental Balance Sheet Disclosures.” List the items that are included in this category and give a brief description of each.

3. Calculate accounts payable turnover, both as a ratio and in number of days. Describe what this ratio means. Also compute the following other ratios (if you have already computed them as part of your work in previous chapters, refer to them): (1) current ratio, (2) quick ratio, (3) days sales to collection for accounts receivable, and (4) inventory turnover (express in days by dividing 365 by the turnover). How do you think you would combine the information in these ratios to assess RadioShack’s current debt-paying ability (Challenge)?

4. Refer to Note 5 (Indebtedness and Borrowing Facilities). What specific items are included? List them, including interest rates. Where is related interest information recorded? Are any of these amounts due currently? Which ones? How can you tell? When are the remainder due? 

5. Refer to Note 13 (Commitments and Contingencies). Describe the contents of this footnote. Are any of these items included in the liabilities recorded in either the current or long-term section of the balance sheet? Why or why not?