Question

Difference between outstanding expenses and prepaid expenses

Answer 1

Outstanding expenses are expenses which are incurred but not yet paid. ...Outstanding expenses are shown in thebalance sheet as a current liability and then recognized as expenses when they are paid in the next accounting period or periods.

Answer 2

Prepaid expenses are future expenses that have been paid in advance. You can think of prepaid expenses as costs that have been paid but have not yet been used up or have not yet expired. The amount of prepaid expenses that have not yet expired are reported on a company's balance sheet as an asset.