A College Has Collected Returnable Dormitory Room Deposits from Students

question 16

Multiple Choice

A college has collected returnable dormitory room deposits from students. How would these deposits be reported by the college?

• A) A current liability.
• B) Unrestricted revenue.
• C) Restricted revenue.
• D) A long-term liability.

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Definitions:

Instrument

A formal document, such as a contract, will, or legal filing, that records and formalizes rights, obligations, or transactions.

Gift

A transfer of personal property by one individual to another without any consideration or payment.

Acceptor

In the context of banking and finance, an acceptor refers to the party who agrees to pay a bill of exchange or draft, typically a bank.

Draft

A preliminary version of a document or plan, subject to revisions and corrections.