Which of the Following Correctly Describes Interest Payable

question 16

Multiple Choice

Which of the following correctly describes Interest payable?

• A) Interest payable is shown on the balance sheet as a current liability.
• B) Interest payable is shown on the income statement as an operating expense.
• C) Interest payable is shown on the balance sheet as a current asset.
• D) Interest payable is shown on the balance sheet as a long-term liability.

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Definitions:

Loss

A situation in which expenses exceed revenues, leading to a negative financial outcome for a business or individual.

Cars

Motor vehicles with four wheels designed for transporting people on roads, ranging from compact models to larger family-sized versions.

Opportunity Costs

The financial sacrifice made by not selecting the alternative that ranks immediately lower when faced with a decision.

Cars

Wheeled motor vehicles used for transportation, typically powered by an internal combustion engine or electric motors.