Which of the Following Accounts Would Not Be Considered a Reserve

question 45

Multiple Choice

Which of the following accounts would not be considered a reserve account?

• A) Allowance
• For Doubtful Accounts
• B) Estimated Warranty Liability
• C) Prepaid Expense
• D) Accumulated Depreciation

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Definitions:

Wages and Salaries

Wages and Salaries refer to the regular compensation paid to employees for their labor or services in executing their job responsibilities.

Note Payable

A financial obligation or loan evidenced by a promissory note, which requires the borrower to pay back the amount borrowed plus interest.

Incremental Borrowing Rate

The Incremental Borrowing Rate is the interest rate a company would have to pay if it borrows funds, used in lease accounting to measure lease liabilities.

Equipment

Tangible property owned by a business that is used in its operations to generate income.