Answered: Which of the following items is most…

Which of the following items is most likely a short-term liability? Select one: a. Finance lease covering 30-year term b. Deferred income taxes c. Bonds payable d. Accounts payable

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 1MC: Which of the following is not considered a current liability? A. Accounts Payable B. Unearned...

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Question

Which of the following items is most likely a short-term liability?

Select one:

a. Finance lease covering 30-year term

b. Deferred income taxes

c. Bonds payable

d. Accounts payable

Definition Definition Estimated future tax made while preparing accounts. Deferred tax is estimated based on past and present transactions from financial statements. It is not the actual tax that needs to be paid or is refundable from the revenue authority; it is an accounting entry. It is necessary to account for deferred tax due to difference between accounting profits and taxable profits.

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