Which of the following balance sheet accounts is least likely to vary directly with sales?

Question

Quizplus · Accepted Answer

Long-term debt is typically not directly related to sales. It may increase or decrease based on decisions to add or pay down debt, but it is not directly affected by the level of sales. In contrast, accounts payable and accounts receivable can vary with sales because the level of purchases or sales on credit can change with sales volume. Inventory can also vary with sales if the level of inventory needed to support sales changes. Long-term debt is typically not directly related to sales, as companies usually acquire and repay it based on their long-term financial goals and strategies. A and C can vary directly with sales, as they reflect a company's short-term obligations related to its sales transactions. Inventory levels can also vary with sales, as companies typically need to increase inventory levels to meet higher demand.

Which of the Following Balance Sheet Accounts Is Least Likely