What Is the Liability Called That Arises from an Expense

question 125

Multiple Choice

What is the liability called that arises from an expense that the business has incurred but has not yet paid?

• A) It is known as an unearned expense.
• B) It is called a deferred expense.
• C) It is called a prepaid expense.
• D) It is referred to as an accrued expense.

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Definitions:

Budgeted Unit Sales

The projected quantity of units that a company plans to sell within a specific period, as part of its financial and operational planning.

Cash Collections

The process of receiving and processing payments from customers, typically involving invoices and receipts.

Selling Price

The amount of money charged for a product or service, or the sum a seller takes into consideration when selling an asset.

Budgeted Unit Sales

The projected quantity of sales units a company expects to sell over a specific period, often used in financial and sales planning.