A T-Account Shows Total Debits of $25,000 and Total Credits

question 32

True/False

A T-account shows total debits of $25,000 and total credits of $22,000; therefore, it has a $3,000 credit balance.

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Definitions:

Present Obligation

A duty or responsibility that is expected to be settled in the future, recognized as a liability.

Past Event

An event or transaction that has occurred prior to the balance sheet date, impacting the financial position or performance of an entity.

Reliable Estimate

A calculation or assessment regarding figures or outcomes that is deemed dependable based on available evidence.