How can accrual adjustments for interest incurred but not yet paid affect the balance sheet and the income statement?
A)Accrual adjustments can increase liabilities and increase expenses.
B)Accrual adjustments can increase assets and decrease revenues.
C)Accrual adjustments can decrease liabilities and increase revenues.
D)Accrual adjustments can increase assets and increase expenses.

Question

Quizplus · Accepted Answer

The adjusting entry to record interest incurred but not yet paid includes a debit to an expense account (Interest Expense)and a credit to a liability account (Interest Payable).

How Can Accrual Adjustments for Interest Incurred but Not Yet