The Securities and Exchange Commission requires that Subscriptions Receivable be disclosed on the financial statements filed with it as an)
A) current asset as long as collection is to be made within one year or the normal operating cycle, whichever is longer.
B) other asset if collection is to be made beyond one year from the date of the financial statements.
C) contra-accounts receivable account.
D) contra-shareholders' equity account.

Question

Quizplus · Accepted Answer

Subscriptions Receivable is typically disclosed as a contra-shareholders' equity account because it represents amounts due from shareholders for shares they have subscribed to but not yet paid for, reducing the total shareholders' equity.

The Securities and Exchange Commission Requires That Subscriptions Receivable Be