Use the information below to answer questions Subscription received during the year ₦30,000 Subscription owed last year ₦4,000 Subscription received for nex...
Question 1 Report
Use the information below to answer questions Subscription received during the year ₦30,000
Subscription owed last year ₦4,000
Subscription received for next year ₦6,000The ₦6,000 subscription received is?
Answer Details
The ₦6,000 subscription received is a current liability.
A current liability is an obligation that a company owes and expects to settle within the next 12 months. In this case, the ₦6,000 subscription received for next year is considered a current liability because it is an advance payment for a service that will be provided in the future, and the service will be provided within the next 12 months.
It's important to note that a liability can be seen as something that the company owes, and in this case, the company owes the service to the subscriber who paid in advance. Therefore, the ₦6,000 subscription received is a current liability for the company until they provide the service and fulfill their obligation to the subscriber.
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