Deferrals Involve the Recording of an Expense or a Revenue

question 88

Multiple Choice

Deferrals involve the recording of an expense or a revenue account:

• A)either before or after the cash is paid or received.
• B)after the cash is paid or received.
• C)before the cash is paid or received.
• D)either before or at the same time the cash is paid or received.

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Definitions:

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business.

Accrued Taxes Payable

Liabilities for taxes that have been incurred but not yet paid.

Current Liability

A company's obligations or debts that are due to be paid to creditors within one year.

Current Asset

Assets that are expected to be converted into cash, sold, or consumed within one year or within the operating cycle of the business, whichever is longer.