Question

Balance Sheet Below are items that may appear on the balance sheet. Required: Match each item with its appropriate classification.
Item
1. Buildings
2. Copyright
3. Supplies
4. Unearned service revenue
5. Prepaid insurance
6. Common stock
7. Rent payable
8. Accounts receivable
9. Allowance for doubtful accounts
10 Bonds payable
Classification
A. Property, plant, and equipment
B. Intangible assets
C. Current assets
D. Current liabilities
E. Current assets
F. Contributed capital
G. Retained earnings

Answer 1

Answer:

Item                                               Classification

1. Buildings                                   - Property, plant, and equipment

2. Copyright                                 - Intangible assets

3. Supplies                                  -  Current assets

4. Unearned service revenue   -   Current liabilities

5. Prepaid insurance                 -  Current assets

6. Common stock                      -  Contributed capital

7. Rent payable                          -  Current liabilities

8. Accounts receivable             -   Current assets

9. Allowance for doubtful accounts   - Retained earnings

10 Bonds payable                       - Current liabilities

Explanation:

A. Property, plant, and equipment

Assets of long term nature that are physical fall in this category.

B. Intangible assets

Assets that are of long term and do not have a physical nature fall in this category

C. Current assets

Assets of a short term nature, existing within a period of 12 months are in this category.

D. Current liabilities

Liabilities or obligations due within a period of 12 months fall in this category.

E. Current assets

Assets of a short term nature, existing within a period of 12 months are in this category.

F. Contributed capital

This involves all capital raised from owners of the company excluding reserves attributed to them.

G. Retained earnings

This is the reserve created out of profit earned during the year. Include incomes and expenses here.