The adjusting entry required to record accrued expenses includes:
A)A credit to Cash.
B)A debit to an asset.
C)A credit to an asset.
D)A credit to liability.

Question

Quizplus · Accepted Answer

An accrued expense is an expense that has been incurred but not yet paid, therefore the company owes money for the expense. The adjusting entry to record this would involve a debit to an expense account (to increase the expense) and a credit to a liability account (to increase the amount owed for the expense). Therefore, the correct choice is D, a credit to liability. The other choices (A-C) do not accurately reflect the nature of accrued expenses.

The Adjusting Entry Required to Record Accrued Expenses Includes