Data for an adjusting entry described as "accrued taxes, $950" requires a
A) debit to Taxes Expense and a credit to Unpaid Taxes Expense
B) debit to Retained Earnings and a credit to Taxes Expense
C) debit to Taxes Payable and a credit to Taxes Expense
D) debit to Taxes Expense and a credit to Taxes Payable

Question

Quizplus · Accepted Answer

Accrued taxes represent taxes that have been incurred but not yet paid, so the correct entry is to debit (increase) Taxes Expense, reflecting the expense incurred, and credit (increase) Taxes Payable, indicating the liability to pay these taxes in the future.

Data for an Adjusting Entry Described as "Accrued Taxes, $950