Which of the following accounts would not be considered a reserve account?
A) Allowance
For Doubtful Accounts
B) Estimated Warranty Liability
C) Prepaid Expense
D) Accumulated Depreciation

Question

Quizplus · Accepted Answer

A reserve account is set aside to cover future expenses or losses, while prepaid expenses represent payments made in advance for goods or services that will be received later. Therefore, prepaid expenses are not considered reserve accounts. Allowance for Doubtful Accounts, Estimated Warranty Liability, and Accumulated Depreciation would all be considered reserve accounts.

Which of the Following Accounts Would Not Be Considered a Reserve