A Credit Balance in Which of the Following Accounts Would

question 143

Multiple Choice

A credit balance in which of the following accounts would indicate a likely error?

• A) Fees Earned
• B) Salary Expense
• C) Common Stock
• D) Accounts Payable

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Definitions:

Current Liabilities

Short-term financial obligations that are due within one year or within the normal operating cycle of a business.

Current Assets

Resources anticipated to be transformed into cash, sold, or utilized within a year or during the standard operational cycle of the company.

Fiscal Year

A one-year period that companies and governments use for accounting purposes and preparing financial statements, which may not align with the calendar year.

Natural Business Year

A fiscal year that ends when business activities have reached the lowest point in an annual operating cycle.