Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

2. Transaction Analysis

Classified Balance Sheet Components

Financial Accounting

2. Transaction Analysis

Classified Balance Sheet Components

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Multiple Choice

Which of the following accounts is NOT included in the asset section of a classified balance sheet?

Inventory

Accounts Payable

Prepaid Expenses

Accounts Receivable

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Verified step by step guidance

Understand the structure of a classified balance sheet: A classified balance sheet organizes assets, liabilities, and equity into specific categories. Assets are typically divided into current assets and non-current assets.

Review the definition of each account: Inventory, Prepaid Expenses, and Accounts Receivable are all current assets, while Accounts Payable is a liability.

Recall that assets represent resources owned by the company, such as cash, receivables, inventory, and prepaid expenses. Liabilities, on the other hand, represent obligations the company owes to others, such as Accounts Payable.

Identify the category of each account: Inventory, Prepaid Expenses, and Accounts Receivable are included in the asset section of the balance sheet. Accounts Payable, being a liability, is not included in the asset section.

Conclude that the account NOT included in the asset section of a classified balance sheet is Accounts Payable, as it belongs to the liabilities section.