Which of the Following Statements Is Not True About Liabilities

question 46

Multiple Choice

Which of the following statements is not true about liabilities?

• A) Liabilities are debts owed to outsiders.
• B) Account titles of liabilities often include the term "payable."
• C) Receiving cash before a service is performed creates a liability.
• D) Liabilities do not include wages owed to employees of the company.

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Definitions:

Mid-ocean Ridge

An underwater mountain system formed by plate tectonics, featuring a continuous volcanic ridge at the boundary of diverging tectonic plates.

Subduction

A geological process where one tectonic plate moves under another and is forced to sink into the mantle.

Magnetic Stripes

Patterns of magnetic anomalies found on the ocean floor, created by the alternating polarity of Earth's magnetic field and used to understand seafloor spreading.

Magnetic Field

A region of space characterized by the presence of a magnetic force, such as that surrounding a magnet or the Earth.