Asked by Johnny Schinas on Apr 24, 2024
Verified
Which of the following accounts is a liability?
A) Accounts Payable
B) Accounts Receivable
C) Wages Expense
D) Service Revenue
Accounts Payable
describes the short-term liabilities a company owes to its suppliers or creditors for goods or services received but not yet paid for.
Accounts Receivable
The amount of money owed to a business by its customers for products or services that have been delivered but not yet paid for.
Liability
A financial obligation owed by an individual or entity to another party, typically classified as current or long-term.
- Understand the fundamental concepts of managing assets and liabilities.
Verified Answer
EP
Eduardo Padron7 days ago
Final Answer :
A
Explanation :
Accounts Payable is a liability account because it represents money owed by a business to its vendors or suppliers for goods or services received but not yet paid for. Accounts Receivable represents money owed to a business by its customers and is therefore an asset. Wages Expense and Service Revenue are both income statement accounts and not balance sheet accounts, therefore they are not liabilities.
Learning Objectives
- Understand the fundamental concepts of managing assets and liabilities.