Which of the following items would be recognised as a liability?
A) advances from customers for goods and services to be provided next year
B) accumulated depreciation
C) the estimated cost of maintenance of plant deferred from this year to next year
D) interest earned but not yet received.

Question

Quizplus · Accepted Answer

Advances from customers for goods and services to be provided next year are recognized as a liability because the company has received payment for products or services that have not yet been provided. Therefore, the company still owes a debt to the customer for these items.

Which of the Following Items Would Be Recognised as a Liability