Final answer:
An unused line of credit is not a liability; it becomes a liability only when the credit is used. Estimated income taxes, sales tax collected, and advances from customers are all liabilities because they represent future economic outflows.
Step-by-step explanation:
Among the given options, an unused line of credit is not a liability. A liability is something that a person or company owes, usually a sum of money. Liabilities are settled over time through the transfer of economic benefits including money, goods, or services.
Estimated income taxes and sales tax collected from customers are both liabilities because they represent money that the company owes to a third party and is expected to pay in the future. Similarly, advances from customers are also liabilities because this is money received by the company for goods or services that have to be provided in the future. In contrast, an unused line of credit is merely a potential obligation; it does not become a liability until the credit line is actually drawn upon.
If we talk about the balance sheet, it an accounting tool that lists assets and liabilities. It should be noted that money listed under assets on a bank's balance sheet may not actually be in the bank due to the asset-liability time mismatch, where customers can withdraw a bank's liabilities in the short term while the bank's assets, in the form of loans, are repaid over the long term.