Which of the following situations is not an example of a deferral?
A)Recording supplies consumed.
B)Recording unrecorded,earned revenues.
C)Recording depreciation.
D)Recording the portion of prepaid rent that has expired.

Question

Quizplus · Accepted Answer

Deferrals involve recording transactions for expenses that have been paid but not yet incurred or revenues that have been received but not yet earned. Recording unrecorded, earned revenues (B) is not a deferral; it is an example of an accrual, where revenues are recognized when earned, regardless of when cash is received.

Which of the Following Situations Is Not an Example of a Deferral