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

9. Current Liabilities

Types of Liabilities

Financial Accounting

9. Current Liabilities

Types of Liabilities

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Multiple Choice

Which of the following terms refers to something pledged as security for repayment of a loan?

Collateral

Contingent liability

Accrued expense

Accounts payable

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Verified step by step guidance

Understand the concept of 'Collateral': Collateral refers to an asset or property that a borrower offers to a lender as security for a loan. If the borrower fails to repay the loan, the lender has the right to seize the collateral to recover the debt.

Review the term 'Contingent liability': A contingent liability is a potential obligation that may arise depending on the outcome of a future event. It is not directly related to securing a loan.

Examine the term 'Accrued expense': Accrued expenses are expenses that have been incurred but not yet paid. These are liabilities recorded in the accounting books but are unrelated to loan security.

Analyze the term 'Accounts payable': Accounts payable refers to amounts owed by a company to its suppliers for goods or services received. It is a liability but does not serve as security for a loan.

Conclude that 'Collateral' is the correct term: Based on the definitions, collateral is the term that specifically refers to something pledged as security for repayment of a loan.