Categorise the three items below as either “current liabilities” or “long-term liabilities” of a firm as at 31 December 2018 and choose the option 1,2,3 or 4 which correctly categorises all three items.
Item 1 – a bank loan repayable by the firm as a single lump sum on 31 March 2021
Item 2 – an electricity bill relating to November and December 2018 but unpaid as at 31 December 2018, because the bill was not received by the firm until 10 January 2019, at which time it was recorded in the appropriate ledger accounts
Item 3 – The portion of a five-year bank loan due to be paid by the firm in 2019. The loan was taken out on 1 January 2017 and is repayable in equal annual instalments over the term of the loan
Select ONE answer:
Show your workings to arrive at your answer, and explain and justify your reasons:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………
This multiple choice question is suitable for Accounting KS5 classes.
The answer is 4
This work is licensed under a Creative Commons Attribution 4.0 International License.
The Multiple Choice Questions Blog 
You must be logged in to post a comment.