An Expense That Has Been Incurred but Not Yet Paid

question 82

Multiple Choice

An expense that has been incurred but not yet paid is called a(n) :

• A)accrued revenue.
• B)prepaid expense.
• C)unearned revenue.
• D)accrued expense.

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Definitions:

Amortization Period

The total length of time over which equal regular payments will repay a loan.

Equal Payments

Regular payments of the same amount over the term of a loan or mortgage.

Compounded Semi-Annually

The process wherein the interest earned on an investment is added to the principal balance twice a year, resulting in compound growth.

Reduction of the Principal

The process of paying down the initial amount borrowed in a loan, not including interest payments.