Which of the following transactions does not involve an accrual?
A)Recording interest earned that will be received in the next period.
B)Recording operating expense incurred but not yet paid.
C)Recording salary expense incurred but not yet paid.
D)Recording the pre-payment of two years' worth of insurance.

Question

Quizplus · Accepted Answer

Pre-payment of insurance is a cash transaction and does not involve accruals. All the other options involve accruals, where revenues or expenses are recognized even if cash has not yet been exchanged.

Which of the Following Transactions Does Not Involve an Accrual