The bank loan is an example of a current liability.

Here's why:

1. Accounts Receivable: This refers to the money that is owed to a company by its customers. Since Luxury Landscapers owes money to the bank, not the other way around, this option is incorrect.

2. A Current Liability: This is a debt that a company must pay within one year. Since the bank loan is a short-term loan that Luxury Landscapers must repay, it is considered a current liability.

3. A Current Asset: This refers to resources that a company expects to convert into cash within one year. Since the bank loan is money that Luxury Landscapers owes, not a resource it owns, this option is incorrect.

4. Idle Cash: This refers to cash that a company has but is not using. Since the bank loan is money that Luxury Landscapers owes, not money it has available to use, this option is incorrect.

So, the correct answer is "a current liability".

Question

The bank loan is an example of a current liability.

Here's why:

1. Accounts Receivable: This refers to the money that is owed to a company by its customers. Since Luxury Landscapers owes money to the bank, not the other way around, this option is incorrect.

2. A Current Liability: This is a debt that a company must pay within one year. Since the bank loan is a short-term loan that Luxury Landscapers must repay, it is considered a current liability.

3. A Current Asset: This refers to resources that a company expects to convert into cash within one year. Since the bank loan is money that Luxury Landscapers owes, not a resource it owns, this option is incorrect.

4. Idle Cash: This refers to cash that a company has but is not using. Since the bank loan is money that Luxury Landscapers owes, not money it has available to use, this option is incorrect.

So, the correct answer is "a current liability".

Knowee AI · Accepted Answer

The bank loan is an example of a current liability.

Here's why:

1. Accounts Receivable: This refers to the money that is owed to a company by its customers. Since Luxury Landscapers owes money to the bank, not the other way around, this option is incorrect.

2. A Current Liability: This is a debt that a company must pay within one year. Since the bank loan is a short-term loan that Luxury Landscapers must repay, it is considered a current liability.

3. A Current Asset: This refers to resources that a company expects to convert into cash within one year. Since the bank loan is money that Luxury Landscapers owes, not a resource it owns, this option is incorrect.

4. Idle Cash: This refers to cash that a company has but is not using. Since the bank loan is money that Luxury Landscapers owes, not money it has available to use, this option is incorrect.

So, the correct answer is "a current liability".

Multiple Choice QuestionLuxury Landscapers currently has a short-term bank loan that was taken out to build an extension on the company's greenhouse. The bank loan is an example of _____.Multiple choice question.accounts receivablea current liabilitya current assetidle cash

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