Given a choice, most companies would prefer to report a liability as long-term rather than current because: It may reduce interest rates on borrowing. It may cause the company to appear more stable, commanding a higher stock price for new stock listings. It may cause the firm to appear less risky to investors and creditors. All of the other answer choices are correct.

Question

Campbell Walsh

Business

2 September, 23:16

Given a choice, most companies would prefer to report a liability as long-term rather than current because: It may reduce interest rates on borrowing. It may cause the company to appear more stable, commanding a higher stock price for new stock listings. It may cause the firm to appear less risky to investors and creditors. All of the other answer choices are correct.

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Aurora · Answer 1

It may cause the firm to appear less risky to investors and creditors.

It may reduce interest rates on borrowing.

It may cause the company to appear more stable commanding a higher stock price for new stock listings.

Explanation: Most company prefer to report liability in long term rather than short term

In accounting long term loan are seen and generally known as company's loans and liabilities that will not be due in one year within the balance sheet date.

When a liability is reported as long term, it will not be within one year of balance sheet date. So if company have a choice, they would prefer to report liability as long term.