Which of the Following Most Likely Would Be Classified as a Current

question 37

Multiple Choice

Which of the following most likely would be classified as a current liability?

• A)Dividends payable
• B)Bonds payable
• C)Three-year notes payable
• D)Mortgage payable

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Definitions:

Indirect Method

A way of preparing the cash flow statement where net income is adjusted for changes in balance sheet items to obtain net cash flow from operating activities.

Direct Method

A cash flow statement preparation approach that lists major operating cash receipts and payments, providing a clear view of operating cash flows.

Comparative Balance Sheets

Financial statements that display the financial position of a business at different points in time side-by-side, allowing for comparison.

Direct Method

An approach in cost accounting where only the direct costs of a department are allocated to its cost objects, ignoring any interdepartmental allocations.