Which of the Following Is Expected to Have a Credit

question 21

Multiple Choice

Which of the following is expected to have a credit balance?

• A) Trade payables
• B) Trade receivables
• C) Rent
• D) Inventory

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Definitions:

Issuing Common Stock

The process by which a corporation sells new shares of its common stock to investors to raise equity capital.

Financing Activities

Transactions and events whereby resources are raised for a corporation, which may affect the equity and debt of the company.

Lessee's Perspective

The viewpoint of the tenant or user in a leasing agreement, focusing on their rights, obligations, and benefits.

Capital Lease

A lease classified as a financial transaction, where the lessee essentially buys an asset and borrows the money through a lease to pay for it, leading to asset and liability recognition in the balance sheet.