Incurred but unpaid expenses that are recorded during the adjusting process with a debit to an expense and a credit to a liability are called
A) Operating expenses.
B) Prepaid expenses.
C) Unearned expenses.
D) Accounts payable.
E) Accrued expenses.

Question

Quizplus · Accepted Answer

Incurred but unpaid expenses are known as accrued expenses, which are recorded during the adjusting process with a debit to an expense and a credit to a liability. This ensures that the expenses are appropriately recorded in the period they are incurred, even if payment is not made until a later period. Therefore, the correct answer is option E, accrued expenses.

Incurred but Unpaid Expenses That Are Recorded During the Adjusting