Which of the Following Items Would NOT Be Recognised as a Liability

question 8

Multiple Choice

Which of the following items would NOT be recognised as a liability?

• A) Advances from customers for goods and services to be delivered later
• B) Warranty on products sold during the year
• C) Final dividend recommended by directors,prior to the annual meeting
• D) A dispute with a customer where there is some possibility that the company could lose the dispute

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Definitions:

Cost of Goods Sold

The explicit expenses linked to manufacturing the products a business sells, including costs for materials and labor.

Balance Sheet

A document detailing a business's assets, liabilities, and equity of shareholders at a particular moment, offering an overview of its financial health.

Spreadsheet

A digital document where data is arranged in rows and columns, commonly used for calculations and data analysis.

Job-Order Costing

An accounting method where costs are assigned to specific jobs or batches, allowing for a detailed tracking of production costs.