Maybel Company has a March 31, 2012 year end. Which of the following should not be recorded as a current liability?
A)A deposit received from a customer for the February 2013 rent on a 1-year lease entered into on March 1, 2011.
B)Unpaid payroll taxes.
C)Dividends in arrears on preferred dividends.
D)Property taxes estimated and unpaid based on the prior year's municipal tax bill.

Question

Quizplus · Accepted Answer

Dividends in arrears on preferred dividends should not be recorded as a current liability, as they are a long-term liability. The other options are all current liabilities: A) the deposit received from a customer is a liability for future rent, B) payroll taxes are a liability to be paid in the current year, and D) property taxes estimated and unpaid are also a current liability.

Maybel Company Has a March 31, 2012 Year End