Which of the following is the best example of an asset?

• A. Owner's Equity
• B. Accounts Payable
• C. Accounts Receivable
• D. Sales Revenue

Answer: (C)

Verified step by step guidance

1. Understand the definition of an asset: An asset is a resource owned or controlled by a company that is expected to provide future economic benefits.
2. Review the options provided: Owner's Equity, Accounts Payable, Accounts Receivable, and Sales Revenue.
3. Analyze each option: Owner's Equity represents the residual interest in the assets of the entity after deducting liabilities, not an asset. Accounts Payable is a liability, representing amounts owed to creditors. Sales Revenue is an income account, reflecting earnings from sales, not an asset.
4. Focus on Accounts Receivable: This represents amounts owed to the company by customers for goods or services provided on credit. It is classified as an asset because it is expected to bring future economic benefits when collected.
5. Conclude that Accounts Receivable is the best example of an asset among the options provided, as it meets the definition of an asset by providing future economic benefits.