Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 10 - No. 13)
What is the effect of recording an accrual of expenses?
Increase liabilities and decrease expenses
Increase liabilities and increase expenses
Decrease liabilities and increase expenses
Decrease liabilities and decrease expenses
Explanation
Accrual of expenses involves recognizing expenses that have been incurred but not yet paid, which increases both liabilities and expenses.
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