Incurring an expense in the current accounting period, which will be paid in the following accounting period, will require:
A)a debit to an expense and a credit to a liability.
B)a debit to a liability and a credit to an expense.
C)a debit to an expense and a credit to cash.
D)a debit to an expense and a credit to capital.

Question

Quizplus · Accepted Answer

When an expense is incurred in the current period but will be paid in the future, it is recorded by debiting the expense account to recognize the expense and crediting a liability account (such as accounts payable) to recognize the obligation to pay in the future. This follows the accrual basis of accounting, where expenses are recognized when incurred, not necessarily when paid.

Incurring an Expense in the Current Accounting Period, Which Will