An example of an account that could be included in an accrual adjustment for expense is:
A)Accounts Receivable.
B)Income Tax Payable.
C)Prepaid Insurance.
D)Accumulated Depreciation.

Question

Quizplus · Accepted Answer

An accrual adjustment is needed when a company has incurred an expense in the current period but has not yet received or paid the related cash.The related cash will not be paid until a later period.As a result,the liability involved usually has the word "Payable" in the account name.If income tax is owed but not paid in cash until later,an accrual adjustment is needed at the end of the current month to record increases in the company's Income Tax Expense and Income Tax Payable accounts.

An Example of an Account That Could Be Included in an Accrual