Identify the Classifications of the Following Accounts as Either Current

question 151

Multiple Choice

Identify the classifications of the following accounts as either current or long-term liabilities for the December 31, 2016 balance sheet.
-An amount of money owed to a supplier based on the terms 2/20, n/40, for which no note was executed.

• A)Current liability
• B)Long-term liability

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Definitions:

Dollars

The official currency of the United States, used as a standard monetary unit.

Annual Risk-free Rate

The theoretical rate of return of an investment with zero risk over a one-year period, often represented by government bonds.

Futures Price

The price at which a futures trader commits to make or take delivery of the underlying asset.

Spot Exchange Rate

The current exchange rate at which one currency can be exchanged for another for immediate delivery.