When dealing with the elements of the financial statements, it is important to consider that:
A) the current portion of long-term debt is the amount due within the next year and must be disclosed separately.
B) fixed assets are short-term assets the company plans on selling in the near future.
C) cost of goods sold is a component of paid-in capital.
D) retained earnings is a long-term liability account.

Question

Quizplus · Accepted Answer

The current portion of long-term debt is a liability that must be disclosed separately in the financial statements. It represents the amount of long-term debt that is due within the next year.

Answer: None of the other options. 
 Fixed assets are long-term assets that a company plans on using for more than one year. Cost of goods sold is an expense that is subtracted from revenue in order to calculate gross profit. Retained earnings is a component of equity, representing the portion of a company's net income that is kept by the company rather than paid out as dividends. None of these options accurately describe the elements of the financial statements.

When Dealing with the Elements of the Financial Statements, It