Which of the following is not an acceptable treatment for the presentation of current liabilities?
A) Listing current liabilities in order of maturity
B) Listing current liabilities according to amount
C) Offsetting current liabilities against assets that are to be applied to their liquidation
D) Showing current liabilities immediately below current assets to obtain a presentation of working capital

Question

Quizplus · Accepted Answer

Offsetting current liabilities against assets that are to be applied to their liquidation is not an acceptable treatment for the presentation of current liabilities according to generally accepted accounting principles (GAAP). According to GAAP, current liabilities should be listed in the order of maturity (shortest term to longest term) or by significance (largest amount to smallest amount). Showing current liabilities immediately below current assets to obtain a presentation of working capital is also an acceptable treatment.

Which of the Following Is Not an Acceptable Treatment for the Presentation