Question

Which of the following items are liabilities of Siebers Jewelry Stores? Indicate by Yes/No.

Answer 1

Answer:

Accounts Payable -Yes

Salaries and wages payable - Yes

Explanation:

Accounts Payable is the money which the business owes its suppliers. It is a liability.

Salaries and wages refers to the debts of the business to its employees. It is also a liability.

Answer 2

Answer:

(a) Cash - NO

(b) Accounts payable - YES

(c) Owner’s drawings - NO

(d) Accounts receivable - NO

(e) Supplies - NO

(f) Equipment - NO

(g) Salaries and wages payable - YES

(h) Service revenue - NO

(i) Rent expense - NO

Explanation:

There are 5 basic categories for accounts:

Asset: Something a business has or owns. This includes Cash

Office Supplies or other prepaid expenses

Accounts receivable

Inventory

Equipment

Building

Land

Liability: Something we owe to a non-owner. Some of the examples are; Accounts Payable

Sales Tax Payable

Wages Payable

Payroll Taxes Payable

Unearned Revenue

Mortgage Payable

Notes Payable

Equity: Something we owe to the owners or the value of the investment to the owner

Revenue: Value of the goods we have sold or the services we have performed e.g. Service Revenue

Sales Revenue

Interest Revenue

Expenses: Costs of doing business for example; Cost of Goods Sold

Utilities Expense

Wages Expense

Rent Expense

Supplies Expense

Insurance Expense

Advertising Expense

Bank Fees Expense