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- Question
Is accounts receivable an asset or liability?
- Correct Answer
- Accounts receivable is the amount to be received by the seller from the customer Hence, it comes under asset
- 1. The APC is calculated as
Options- A. consumption/income
- B. change in income/change in consumption
- C. income/consumption
- D. change in consumption/change in income Discuss
- 2. Unearned revenue is classified as
Options- A. Liability
- B. Owner's equity
- C. Asset
- D. Income Discuss
- 3. Depreciation is a process of
Options- A. Allocation
- B. Valuation
- C. Both A & B
- D. Appropriation Discuss
- 4. Accounts Receivable financing is based on Discuss
- 5. Which of the following is not true about enterprise systems?
Options- A. Enterprise software is expressly built to allow companies to mimic their unique business practices.
- B. Enterprise software includes analytical tools to evaluate overall organizational performance.
- C. Enterprise system data have standardized definitions and formats that are accepted by the entire organization.
- D. Enterprise systems help firms respond rapidly to customer requests for information or products. Discuss
- 6. Which of the following best describes term life insurance?
Options- A. The insured pays a premium for a specified number of years.
- B. The insured is covered during his or her entire lifetime.
- C. The insured pays the premium until his or her death.
- D. The insured can borrow or collect the cash value of the policy. Discuss
- 7. The principle of diversification tells us that
Options- A. spreading an investment across many diverse assets will eliminate some of the total risk
- B. concentrating an investment in two or three large stocks will eliminate all of the unsystematic risk
- C. spreading an investment across five diverse companies will not lower the total risk
- D. concentrating an investment in three companies all within the same industry will greatly reduce the systematic risk Discuss
- 8. when a purchase on account is made the invoice becomes
Options- A. debt
- B. credit
- C. both A & B
- D. None of the above Discuss
- 9. What type of account is accounts receivable?
Options- A. Asset
- B. Liability
- C. Expense
- D. Equity Discuss
- 10. Invoice is an example of
Options- A. Accounts Receivable
- B. Accounts Payable
- C. Both A & B
- D. None of the above Discuss
Accounting and Finance problems
Search Results
Correct Answer: consumption/income
Explanation:
The average propensity to consume (APC) is the ratio of consumption expenditures (C) to disposable income (DI), or APC = C / DI.
Hence, APC = consumption/income.
Correct Answer: Liability
Explanation:
Unearned revenue is the money or revenue earned for the product or the service that is not yet sold or provided to the customer. Hence, it comes under liabilities.
Correct Answer: Allocation
Explanation:
Depreciation is a process of cost allocation, not valuation. In accounting, the term depreciation refers to the allocation of cost of a tangible asset to expense to the periods in which the asset is expected to be used to obtain the economic benefit.
In brief, Depreciation is fall in the value of assets due to wear and tear over a period of time, it is a loss.
Correct Answer: Accounts-receivable financing is a type of asset-financing arrangement in which a company uses its receivables ? outstanding invoices or money owed by customers ? to receive financing when a business sells its AR (accounts receivable) to a factoring company and receives short-term business funding in return, this is what called as Accounts Receivable Financing How it works :: Business-to-business sales are often offered with payment terms of 30, 60 or 90 days The buyer receives the product, but doesn't submit payment until the mutually agreed-upon date The seller records the sale as revenues and increases the accounts receivable by the amount of the sale When the payment arrives, the seller decreases the accounts receivable and increases cash Accounts receivable financing allows the seller to get the cash immediately by selling the receivable to a third party This is called factoring
Correct Answer: Enterprise software is expressly built to allow companies to mimic their unique business practices.
Explanation:
Enterprise systems (ES) are large-scale application software packages that support business processes, information flows, reporting, and data analytics in complex organizations.
Correct Answer: The insured pays a premium for a specified number of years.
Correct Answer: spreading an investment across many diverse assets will eliminate some of the total risk
Explanation:
The principle of diversification tells us that spreading an investment across many diverse assets will eliminate some of the total risk.
Correct Answer: debt
Correct Answer: Asset
Explanation:
Accounts receivable is listed as a current asset in the balance sheet, since it is usually convertible into cash in less than one year as it is the amount owed by the customer to the seller.
Correct Answer: Accounts Receivable
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