Define each of the following terms: k. Accruals; trade credit
Define each of the following terms:
Accruals - It refers to any expenses that have been incurred, but the payment is outstanding which means yet to be made. They automatically increase with an increase in operations of the firm.
Trade Credit - It is the amount that the company will pay in the future for the goods that are purchased on credit. It is recorded as accounts receivable in the books of seller and as accounts payable in the books of buyer.