Which Account is not a Liability Account? (a) Account Payable (b) Accrued Expenses (c) Cash (d) Notes Payable
By BYJU'S Exam Prep
Updated on: November 9th, 2023
Cash is not a liability Account. As against liability is the financial value of an obligation or debt payable by the business to another organization or person. Liabilities are not subject to depreciation. A loan that needs to be repaid and from which cash will flow.
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Non-Liability Account
Resulting of business transactions, a company records the following in a liability account, which is a general ledger account:
- Payable to suppliers for products and services purchased on credit.
- Amount due to banks and other lenders as principal for the loan.
- Costs that buyers have prepaid, deposits made by customers, and other amounts that have been incurred but not yet processed.
- Certain business taxes have been deferred.
- Contingent Liabilities that are Probable and Quantitative.
Examples of Liability Accounts
Common liability accounts used with the accrual method of accounting include:
- Accounts Payable
- Deferred Income Taxes
- Notes Payable or Loans Payable
- Accrued Liabilities or Accrued Expenses
- Unearned Revenues or Customers’ Deposits
Liabilities are listed on the balance sheet as either current liabilities or noncurrent (or long-term) liabilities. Liabilities are balances that are almost usually credit balances.
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