Where the amount of cash paid for office expenses during the year is less than the amount of office expenses recognised in the statement of financial performance under the accrual accounting approach, the difference is recorded in the statement of financial position as:

Question

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When the cash paid for office expenses is less than the expenses recognized, the difference represents expenses that have been incurred but not yet paid. This is recorded as an accrued expense, which is a liability on the statement of financial position.

Where the Amount of Cash Paid for Office Expenses During