Question

In: Accounting

Which of the following is not a liability?


Which of the following is not a liability? 

 A. Accrued warranties payable 

 B. Income taxes payable 

 C. Allowance for bad debts 

 D. Accrued vacation pay

Solutions

Expert Solution

Allowance for bad debts is not a liability.

Correct option is (C)

Allowance for bad debts is a contra assets account. It is subtracted from accounts receivable to find out Net realizable value of accounts receivable.

Accrued warranties payable, Income tax payable and accrued vacation pay are all liabilities.

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ekkarill92 answered 2 years ago
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