Question

'Bank overdraft' should be classified as ______________.

• A. Current asset
• B. Current liability
• C. Fixed assets
• D. None of these

Answer 1

The correct option is B Current liability

Liabilities which are payable within a short period are treated as current liabilities. Examples of current liabilities are Bank overdraft, sundry creditors, bills payable, outstanding expenses etc.

Bank overdraft should be classified as Current Liability.