Question

The following are common categories on a classified balance sheet.

A. Current assets D. Intangible assets

B. Long-term investments E. Current liabilities

C. Plant assets F. Long-term liabilities

For each of the following items, select the letter that identifies the balance sheet category where the item

typically would best appear.

1. Land not currently used in operations 5. Accounts payable

2. Notes payable (due in five years) 6. Store equipment

3. Accounts receivable 7. Wages payable

4. Trademarks 8. Cash

Short answer

Answer:

Cash comes under the head of the current asset. Category is shown in step 2.

Step-by-step solution

Step-by-Step Solution

Step 1: Definition of current asset

Current assets are those assets that can be transferred into cash easily.

Category where the item appears

1. Land- It would appear in plant assets
2. Accounts payable- It would appear in current liabilities
3. Accounts Receivable- It would appear in the current asset
4. Trademark- It would appear in a plant asset
5. Notes payable- It would appear in long-term liabilities
6. Store equipment- It would appear plant assets
7. Cash- It would appear in current asset