Saturn Company has the following transactions as of December 31, 2021. Indicate which, if any, should be shown on a balance sheet of Saturn Company as of December 31, 2021 as a liability. 1. Saturn received an invoice for supplies it ordered at the end of December totaling $5,000, but the supplies have not been received as of December 31. 2. Saturn received an invoice for advertising services provided in December, in the amount of $10,000. 3. Saturn will receive a $10,000 loan from its bank on January 1, 2022. 4. Saturn is being sued for $250,000 in a suit claiming wrongful termination of an employee. Saturn's management believes that the case is frivolous and without merit. 5. Saturn is being sued by one of its vendors for $25,000 for breach of contract. Saturn's management believes that the vendor will probably prevail.
Saturn Company has the following transactions as of December 31, 2021. Indicate which, if any, should be shown on a balance sheet of Saturn Company as of December 31, 2021 as a liability. 1. Saturn received an invoice for supplies it ordered at the end of December totaling $5,000, but the supplies have not been received as of December 31. 2. Saturn received an invoice for advertising services provided in December, in the amount of $10,000. 3. Saturn will receive a $10,000 loan from its bank on January 1, 2022. 4. Saturn is being sued for $250,000 in a suit claiming wrongful termination of an employee. Saturn's management believes that the case is frivolous and without merit. 5. Saturn is being sued by one of its vendors for $25,000 for breach of contract. Saturn's management believes that the vendor will probably prevail.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Saturn Company has the following transactions as of December 31, 2021. Indicate
which, if any, should be shown on a balance sheet of Saturn Company as of
December 31, 2021 as a liability.
1. Saturn received an invoice for supplies it ordered at the end of December
totaling $5,000, but the supplies have not been received as of December 31.
2. Saturn received an invoice for advertising services provided in December, in the
amount of $10,000.
3. Saturn will receive a $10,000 loan from its bank on January 1, 2022.
4. Saturn is being sued for $250,000 in a suit claiming wrongful termination of an
employee. Saturn's management believes that the case is frivolous and without
merit.
5. Saturn is being sued by one of its vendors for $25,000 for breach of contract.
Saturn's management believes that the vendor will probably prevail.
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