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    Question

    Interest payable on the bonds is a/an _______

    A Provision Correct Answer Incorrect Answer
    B Accrued expense Correct Answer Incorrect Answer
    C Accrued income Correct Answer Incorrect Answer
    D Prepaid expense Correct Answer Incorrect Answer

    Solution

    An accrued expense is one that is known to be due in the future with certainty. Interest payable on the bonds is a known figure. It can be estimated well ahead of time, and money can be set aside for it

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