Which of the Following Represents a Liability

question 66

Multiple Choice

Which of the following represents a liability?

• A) The obligation to pay for goods that a company expects to order from suppliers next year.
• B) The obligation to provide goods that customers have ordered and paid for during the current year.
• C) The obligation to pay interest on a five-year note payable that was issued the last day of the current year.
• D) The obligation to distribute shares of a company's own common stock next year as a result of a stock dividend declared near the end of the current year.

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Definitions:

Perfectly Competitive Market

A market structure characterized by many buyers and sellers, all of whom have full information and the products are homogeneous, leading to no single buyer or seller being able to influence the market price.

Quantity Of Output

The total amount of goods or services produced by a company, sector, or economy during a specified period.

Marginal Revenue

The extra revenue earned by selling an additional unit of a product or service.

Total Revenue

The sum total of financial gains a company secures from its commercial transactions or service provisions during a certain interval.