The accrued liabilities of a firm are:
A) retained earnings from past years
B) reflect the prepayment of certain expenses
C) owners' equity in the firm
D) amounts owed but not yet due

Question

Quizplus · Accepted Answer

Accrued liabilities are amounts that a company owes but has not yet paid. These can include wages and salaries, taxes, interest, and other expenses that have been incurred but not yet billed or paid. Option A is incorrect because retained earnings are not accrued liabilities, but rather a part of owners' equity. Option B refers to prepaid expenses, which are not accrued liabilities. Option C is incorrect as owners' equity reflects the ownership interest in the firm, not accrued liabilities.

The Accrued Liabilities of a Firm Are