A deferred expense is initially recorded as:
A) an asset but becomes an expense over time.
B) an expense but becomes an asset over time.
C) a liability but becomes an expense over time.
D) an expense but becomes a liability over time.

Question

Quizplus · Accepted Answer

A deferred expense is an asset as it represents prepayments made for goods or services that will be received in the future. Over time, the asset is reduced and becomes an expense as the good or service is consumed or utilized.

A Deferred Expense Is Initially Recorded As