Many current liabilities are affected by accrual accounting entries. This happen

Question

Many current liabilities are affected by accrual accounting entries. This happens because:

liabilities are usually paid when they are incurred

accrual accounting involves recognizing liabilities before they are paid.

the only way to reduce a liability account balance is with an adjusting entry.

accrual accounting frequently involves recognizing liabilities before they are incurred.

liabilities are usually paid when they are incurred

accrual accounting involves recognizing liabilities before they are paid.

the only way to reduce a liability account balance is with an adjusting entry.

accrual accounting frequently involves recognizing liabilities before they are incurred.

Explanation / Answer

Many current liabilities are affected by accrual accounting entries. This happens because accrual accounting involves recognising liabilities before they are paid.

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