Which of the following is not an asset? Question 2 Answer Prepaid Rent Equipment Accounts Payable Vehicles

Break Down the Problem

1. Identify which items are typically considered assets.
2. Understand the definition of liabilities and how they differ from assets.

Relevant Concepts

• Assets: Resources owned by a company that have economic value (e.g., prepaid rent, equipment, vehicles).
• Liabilities: Obligations or debts owed to outside parties (e.g., accounts payable).

Analysis and Detail

1. Prepaid Rent: This is considered an asset because it represents rent that has been paid in advance for future use.
2. Equipment: This is an asset, as it is a tangible item that can contribute to generating revenue.
3. Accounts Payable: This is a liability, representing money that the company owes to suppliers or creditors.
4. Vehicles: These are assets since they are physical resources owned by the company.

Verify and Summarize

After analyzing each item, it's clear that accounts payable does not represent an asset; it is a liability.

Final Answer

Accounts Payable is not an asset.