Which of the Following Statements About Current Liabilities Is True

question 128

Multiple Choice

Which of the following statements about current liabilities is true?

• A) The current ratio is defined as current assets divided by current liabilities.
• B) The current liability section never contains any portion of long-term liabilities.
• C) Current liabilities are listed in order of decreasing amounts in the current liability section of the balance sheet.
• D) The amount of current liabilities has little implication for a company's liquidity.

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Definitions:

Telephone

A telecommunications device that allows users to conduct voice communication across distances.

Harass

Engaging in a pattern of unwanted, aggressive behavior towards an individual or group, often causing distress or alarm.

Detinue

A legal action to recover personal property wrongfully taken or retained, or compensation for its value.

Compensation

Payment or reward given to someone as a recompense for loss, injury, or suffering.