Which of the following are considered to be spontaneous sources of financing (i.e., they arise naturally during the course of doing business)?
A) Notes payable and common stock
B) Accounts receivable and bonds
C) Fixed assets and inventory
D) Accounts payable and accrued expenses

Question

Quizplus · Accepted Answer

Accounts payable and accrued expenses are considered to be spontaneous sources of financing as they arise naturally during the course of doing business. Accounts payable represent amounts owed to suppliers for goods and services purchased on credit, while accrued expenses are expenses that have been incurred but not yet paid. Both of these sources of financing represent liabilities that are created as a result of the normal operations of a business. The other options listed (notes payable, common stock, accounts receivable, bonds, fixed assets, and inventory) are not considered spontaneous sources of financing.

Which of the Following Are Considered to Be Spontaneous Sources