Incurred but unpaid expenses that are recorded during the adjusting process with a debit to an expense and a credit to a liability are:
A) Intangible expenses.
B) Prepaid expenses.
C) Unearned expenses.
D) Net expenses.
E) Accrued expenses.

Question

Quizplus · Accepted Answer

Incurred but unpaid expenses are accrued expenses. They are expenses that have been incurred by the company but have not yet been paid, so they need to be recorded as a liability in the accounting records. During the adjusting process, these expenses are recorded with a debit to an expense account and a credit to a liability account, which increases the company's expenses and liabilities for the period. Therefore, the correct answer is E) Accrued expenses.

Incurred but Unpaid Expenses That Are Recorded During the Adjusting