Which of the following liabilities is often referred to as "free debt" because it rarely carries any interest if paid within a specified period of time?
A)line of credit
B)working capital loan
C)accounts payable
D)None of the above-all current liabilities carry an interest rate.

Question

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Accounts payable are often referred to as "free debt" because they rarely carry any interest if paid within a specified period of time, usually 30-60 days. This is because suppliers are willing to offer trade credit as a way to encourage their customers to continue doing business with them.

Which of the Following Liabilities Is Often Referred to as "Free