Intuit Academy Bookkeeping Professional
Certificate: Liabilities and Equity
Accounting Equation - ANSWER Assets = Liabilities + Owner's Equity Current Liabilities - ANSWER Will be paid in 1 year (I.E Accounts payable, Payroll and benefits Liabilites, Lines of Credit, Credit Cards, Income Tax Liabilities, Deferred Revenue) Noncurrent Liabilities - ANSWER Due in 1 year or more (I.E Long
term loans; Notes Payable: mortgage, car loan, promissory loan; Bonds payable;
Deferred income tax) Liquidity - ANSWER The ability to generate sufficient current assets to pay current liabilities 1 / 2
Solvency - ANSWER Ability to meet company obligations in future Debt to Equity Ratio - ANSWER Tracks increases and decreases in liabilities as a percentage of equity.Accounts Receivable Turnover Rate - ANSWER How fast accounts receivable are collected Income Tax - ANSWER Taxes payed to the state and federal government on wages earned by employees Bonds Payable - ANSWER long term debt securities issued by a company which promises to pay back the principal at some specified point in the future
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