Question

Indicate whether each of the following is identified with (1) an asset, (2) a liability, or (3) stockholders' equity: a. Accounts payable b. Accounts receivable c. Fees earned d. Supplies e. Supplies expense f. Utilities expense

Answer 1

Answer and explanation:

An asset is a resource with economic value. Assets can be tangible, such as equipment and land or intangible including things like a brand, a chemical formula or property rights.

Liabilities are all those responsibilities firms incur as a result of the operations of the business. Liabilities include notes, accounts, salaries, and interest payable.

Stockholders' Equity represents the equity stakeholders own of a company. They could be common stock, preferred stock, retained earnings or expenses incurred during the period. Thus:

A) Accounts payable (Liability)

B) Accounts receivable (Asset)

C) Fees earned (Stockholder's equity)

D) Supplies (Assets)

E) Supplies expense (Stockholder's equity)

F) Utilities expense (Stockholder's equity)