Which of the Following Groups of Accounts Contains Only Those

question 9

Multiple Choice

Which of the following groups of accounts contains only those accounts that normally have credit balances?

• A)Accounts Payable; Retained Earnings; Service Revenue.
• B)Equipment; Cash; Contributed Capital.
• C)Notes Payable; Wages Payable; Rent Expense.
• D)Accounts Receivable; Accounts Payable; Unearned Revenue.

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Definitions:

Financial Statements

Financial statements are formal records of the financial activities and position of a business, person, or other entity, typically comprising the balance sheet, income statement, and cash flow statement.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations with its current assets.

Liquidity

The simplicity of converting an asset or security into cash without impacting its market value.

P/E Ratio

The price-to-earnings ratio, a valuation metric comparing the current share price of a company to its per-share earnings.