Question

Which of the following is true? a) Cash is a current asset and expenses are a...

Which of the following is true?

a) Cash is a current asset and expenses are a current liability

b) Accounts receivable is a current liability and accounts payable is a current asset

c) Accounts receivable is a current asset and revenue is a current asset

d) Inventory is a current asset and wages payable is a current liability

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Homework Answers

Answer #1

Option d is correct.

Let us skim all the options.

Option a - Cash is a current asset but expenses is a part of income statement and hence niether an asset or a liability. Hence this is incorrect.

Option b - Account receivable is a current asset and accounts payable is a current liability. Hence this is incorrect.

Option c - Account receivable is a current asset and revenue is a part of income statement and hence niether an asset or a liability. Hence this is incorrect.

Option d - This is correct. Inventory is a current asset and wage payable is a current liability.

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