Liabilities that will be due within one year or less and that are ...

[fbq8i]

Liabilities that will be due within one year or less and that are to be paid out of current assets are called current liabilities.
 a. True
  b. False
 
   Indicate whether the statement is true or false

Question 2

A Motor Pool Internal Service Fund purchased ten new vehicles for their fleet inventory. The fund entered into a capital lease. The capitalizable cost totaled 300,000 and there was a 50,000 down payment.
 
  The entry to record the transaction in the Internal Service Fund would be
 
   Debit Credit
  A. Vehicles
  Expenditures
   Other Financing Source  Capital Lease
   Cash 300,000
  50,000
 
  300,000
  50,000
  B. Vehicles
   Other Financing Source  Capital Lease
   Cash 300,000
  250,000
  50,000
  C. Vehicles
   Capital Lease Payable
   Cash 300,000
  250,000
  50,000
  D. Vehicles
  Expenditures
   Capital Lease Payable
   Cash 250,000
  50,000
 
  250,000
  50,000

[akpaschal]

Answer to Question 1

True

Answer to Question 2

C

[fbq8i]

Excellent

[phuda]

TYSM