Which of the Following Accounts Would Likely Be Included in an Accrual

question 133

Multiple Choice

Which of the following accounts would likely be included in an accrual adjusting entry?

• A) Insurance Expense
• B) Prepaid Rent
• C) Interest Expense
• D) Unearned Rent

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Definitions:

Cost Of Goods Sold

Cost of goods sold (COGS) is the direct cost attributed to the production of the goods sold by a company, including material and labor costs, but excluding indirect expenses.

Ending Inventory

The value of goods available for sale at the end of an accounting period, calculated by adding new purchases to beginning inventory and subtracting cost of goods sold.

Perpetual Inventory Account

An accounting method that records inventory purchases and sales in real time, providing a continuously updated inventory balance.

FIFO

"First In, First Out", an inventory valuation method where the costs of the oldest inventory items are the first to be recognized in determining cost of goods sold.