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If An Accrual Adjusting Entry Increases An Expense And A Liability, How Does The Balance Sheet Remain In Balance? |
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Answer» An expense is a temporary account which REDUCES OWNER's EQUITY or stockholders' equity. The DECREASE in owner's equity will offset the increase in the liability account. An expense is a temporary account which reduces owner's equity or stockholders' equity. The decrease in owner's equity will offset the increase in the liability account. |
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