Rent Owed to the Lessor Under an Operating Lease Would

question 143

Multiple Choice

Rent owed to the lessor under an operating lease would appear on the balance sheet as

• A)current liability.
• B)long-term liability.
• C)current asset.
• D)owners' equity.

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Definitions:

Statement of Cash Flows

A financial report that shows how changes in balance sheet accounts and income affect cash and cash equivalents.

Balance Sheet

A summary report of a company's financial position, detailing assets, liabilities, and equity of shareholders at a certain moment.

Accrual Accounting

Accrual accounting is an accounting method where revenue and expenses are recorded when they are earned or incurred, regardless of when the cash is actually received or paid.

Natural Progression

The gradual and inherent development or sequence of events that naturally unfolds over time.