The Primary Difference Between Prepaid and Accrued Expenses Is That

question 109

Multiple Choice

The primary difference between prepaid and accrued expenses is that prepaid expenses have

• A)been incurred and accrued expenses have not.
• B)not been paid and accrued expenses have.
• C)been paid and accrued expenses have not.
• D)not been recorded and accrued expenses have.

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Definitions:

Selling Expenses

Costs incurred directly in the selling of goods or services, such as commissions and advertising.

Flexible Budget

A budget that modifies itself according to variations in activity or volume levels.

Various Levels

Refers to differing stages or degrees within a hierarchy or system, often used in the context of organizational structure or data categorization.

Fixed Costs

Expenses that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums.