The Primary Difference Between Prepaid and Accrued Expenses Is That

question 76

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 recorded and accrued expenses have not.
• D)not been recorded and accrued expenses have.

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Definitions:

Net Operating Income

A measure of a company's profitability that excludes interest and income tax expenses.

Monthly Sales

The total revenue generated from the sale of products or services within a specific month.

Margin of Safety

The difference between actual or expected sales and sales at the break-even point.

Units

Units are individual portions or segments of a whole, such as items produced, sold, or analyzed in a specific context, serving as a basic measure of quantity.