Asked by Kaohulani Palakiko on Jul 06, 2024
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Accounting accruals are important in:
A) accounting for depreciation.
B) providing for unpaid payroll, rent, interest, and other expenses that relate to the current accounting period.
C) drawing checks on the last day of the current accounting period to properly reflect expense in that period.
D) providing for bad debts that may eventually be deemed uncollectible.
Accounting Accruals
Accounting method where revenue and expenses are recorded when they are earned or incurred, not necessarily when cash is received or paid.
Unpaid Payroll
The total sum of all wages, salaries, bonuses, and deductions owed to employees that have not yet been paid.
Depreciation
The accounting process of allocating the cost of a tangible asset over its useful life, reflecting decrease in value over time.
- Understand the purpose and methodology of accounting accruals in accurately reflecting a company’s financial position.
Verified Answer
Learning Objectives
- Understand the purpose and methodology of accounting accruals in accurately reflecting a company’s financial position.
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