The accrual of interest on short-term marketable securities results in:
A)an increase in current assets and a decrease in net income.
B)an increase in current assets and an increase in net income.
C)an increase in noncurrent assets and an increase in liabilities.
D)an increase in current liabilities and an increase in net income.

Question

Quizplus · Accepted Answer

The accrual of interest on short-term marketable securities increases current assets because the interest receivable is considered a current asset. It also increases net income because the interest earned is recognized as revenue.

The Accrual of Interest on Short-Term Marketable Securities Results In