CAF-1 · Chapter 13 · Question 3 of 15
If a club member pays their annual subscription for the upcoming year in advance, how is this recorded in the current year's financial statements?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) As a current liability in the statement of financial position.
Explanation
Subscriptions received in advance represent an obligation to provide services in the future, so they are classified as a liability (typically current) at the year-end.
More Accounting for NPOs MCQs
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