Accounting Fundamentals Certification (AFC) 2025 – 400 Free Practice Questions to Pass the Exam

Question: 1 / 400

Which of the following does NOT result in the recording of an expense?

Accrued expenses

Owner withdrawal of cash

The owner withdrawal of cash is not recorded as an expense because it pertains to a distribution of equity rather than an operational cost incurred by the business. When an owner withdraws cash, it is treated as a reduction in the owner's equity or capital and does not affect the income statement where expenses are recorded.

In contrast, accrued expenses involve recognizing costs that have been incurred but not yet paid, which directly affects the expense accounts. Supplies used represent an expense because the resources consumed in operations must be recognized in the accounting period. Similarly, depreciation allocates the cost of tangible assets over their useful lives, capturing the expense related to asset wear and tear. Therefore, the only answer that does not involve an expense recording is the owner's withdrawal of cash.

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Supplies used

Depreciation

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