Which of the following is an asset?

Which of the following is an asset?

• A. Liabilities
• B. Mortgage
• C. Accounts Receivable
• D. Equity

Answer: (C)

Assets are resources a business owns or controls that are expected to bring future economic benefits. Accounts Receivable fits because it records money customers owe for goods or services already delivered, representing a future cash inflow. That expected cash makes it an asset, typically shown as a current asset on the balance sheet. By contrast, liabilities are obligations the company owes, a mortgage is a loan payable (a liability for the borrower and an asset for the lender), and equity is the owner’s claim on the assets after liabilities are settled. So Accounts Receivable is the asset in this list.

Assets are resources a business owns or controls that are expected to bring future economic benefits. Accounts Receivable fits because it records money customers owe for goods or services already delivered, representing a future cash inflow. That expected cash makes it an asset, typically shown as a current asset on the balance sheet. By contrast, liabilities are obligations the company owes, a mortgage is a loan payable (a liability for the borrower and an asset for the lender), and equity is the owner’s claim on the assets after liabilities are settled. So Accounts Receivable is the asset in this list.