Question $2(1$ point$)$

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Which one of the following would be considered a contingent liability?

Question $2$ options:

$1)$

A company owes $$200,000$ on inventories purchased on credit.

$2)$

A company has $$1,690,000$ worth of bonds outstanding.

$3)$

A company estimates that it will probably have to pay $$2,400,000$ to the Department of Environment Protection for a chemical spill.

$4)$

The company has access to a line of credit with a bank in the amount of $$3,000,000.$

$5)$

The company has unearned revenue of $$300,000$

$$

Which one of the following would be considered a contingent liability?

Question $2$ options:

$1)$

A company owes $$200,000$ on inventories purchased on credit.

$2)$

A company has $$1,690,000$ worth of bonds outstanding.

$3)$

A company estimates that it will probably have to pay $$2,400,000$ to the Department of Environment Protection for a chemical spill.

$4)$

The company has access to a line of credit with a bank in the amount of $$3,000,000.$

$5)$

The company has unearned revenue of $$300,000$

$$

Which of the following is not true regarding the quick ratio?$$

Question $1$ options:

$1)$

If a company has more current assets than liquid assets, the current ratio will be larger than the quick ratio.

$2)$

A high quick ratio suggests a high ability to pay current liabilities.

$3)$

Liquid assets include cash and cash equivalents, short$-$term investments, and net accounts receivable.

$4)$

A quick ratio greater than $1$ implies a company could not pay all of its current liabilities.

$5)$

The quick ratio and the current ratio are both measures of the firm's ability to pay short$-$term liabilities.