An Example of an Account That Could Be Included in an Accrual

question 224

Multiple Choice

An example of an account that could be included in an accrual adjustment for expense is:

• A)Accounts Receivable.
• B)Income Tax Payable.
• C)Prepaid Insurance.
• D)Accumulated Depreciation.

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Definitions:

Deficits

Occurs when an entity, typically a government, spends more money than it receives in revenue over a specific period, resulting in a shortfall that needs to be financed.

Inflationary Gap

The difference between the actual level of output in an economy and the output level needed to achieve full employment without inflation.

Budget Surplus

A situation where income or revenues exceed expenditures over a specified period of time.

Aggregate Demand

Aggregate demand represents the total demand for goods and services within an economy at a given overall price level and time period.