Goods purchased on account for future use in the business, such as store supplies, are called:
A) accrued liabilities.
B) expenses.
C) revenues.
D) prepaid expenses.

Question

Quizplus · Accepted Answer

Goods purchased on account for future use in the business are called prepaid expenses because payment has been made in advance, and the expenses will be recorded in the future when they are used or consumed. Accrued liabilities are expenses that have been incurred but not yet paid, expenses are costs incurred in the course of operating a business, and revenues are income earned by a business.

Goods Purchased on Account for Future Use in the Business