Which one of the following accounts is a current liability?Group of answer choicesA. ReservesB. Prepaid expenseC. Trade receivablesD. Trade payables

Question

Which one of the following accounts is a current liability?Group of answer choicesA. ReservesB. Prepaid expenseC. Trade receivablesD. Trade payables
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Solution 1

D. Trade payables

Here's why:

A. Reserves: These are not liabilities but rather a part of owner's equity in the balance sheet. They are amounts set aside out of profits and other surpluses to strengthen the financial position of the company.

B. Prepaid expense: This is an asset account. When a co Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study prob

Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study problem.
Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study problem.
Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study problem.
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