5. Which of the following is LEAST likely describing a CURRET ASSET the right to

Question

5. Which of the following is LEAST likely describing a CURRET ASSET the right to collect money from that customer at a specified time in the future, within the next 12 month:s finished products for ready sale to customers and also materials to be made into products bills the company has already paid...but for services not yet received productive assets not intended for sale 6. If a company has a piece of equipment that is intended for sale, it is most likely reported under: PP&E Supplies Other Assets Inventory 7. On the balance sheet, salaries owed to employees is most likely reported under: Accounts payable Notes payable Salaries expense Accrued expenses 8. Which of the following will not affect shareholders' equity? Selling inventory at a price above cost Issuing capital stock Paying dividends to shareholders Collecting accounts receivable

Explanation / Answer

5 Anwer is d. d will be classified as PP&E. (a) will be classified as accounts receivable in current assets (b) will be classified as inventory in current assets © will be classified as advances in current assets 6 Anwer is d. (a) PP&E-Productive assets not intendedd for Sale (b) Supplies-Consumbles in hand © Other assets-Assets which are not a,b & d. 7 Anwer is d. Accounts payable-Amount due from customers Notes payable-Notes issued Salaries expense-Salary for the period which is reported in the income statement 8 Anwer is d. Collecting accounts receivable entry will be Debit Credit Cash xxx Accounts receivable xxx Cash and accounts receivables are current assets.Hence, it will not affect shareholder's equity

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