I have just uploaded my 3rd set of basic bookkeeping and accounting questions, this time the questions focus on accruals and prepayments. The questions are ideal for accounting exam revision or for a quick refresher. The answers to each question are found below the video. Enjoy!
An accrual is...?
An expense relating to the current year but not paid or billed in the current year
A liability is...?
An expense relating to the next year and already paid or billed in the current year
Is an accrual a asset or a liability?
An accrual is a liability
Is a prepayment an asset or a liability?
A prepayment is an asset