Question

Interest paid is
(a) Liability
(b) Income
(c) Expense
(d) Asset​

Answer 1

Answer:

Interest paid is (c) Expense

Answer 2

ANSWER :

★ (c) Expense

• ➻ Interest paid is an expense.

____________________________________________________________

EXPLANATION :

• ✎ Liability :- In accounting, the term "liability" refers to the amount which a business entity is required to pay in future. It is the future monetary obligation of a business.

• ✎ Income :- In accounting, the term "income" refers to excess of revenue over expenses. Income of a business is the amount which is obtained after deducting the amount of expenses from the amount of revenue.

• ✎ Expense :- In accounting, the term "expense" refers to the cost incurred for the purpose of generating revenue by producing, providing and selling goods and services by a business entity.

• ✎ Asset :- In accounting, the term "asset" refers to anything that is in the possession or is the property of a business. It is something which enables a business to generate benefit in future.

Any amount paid by a business is an expense for a business. Hence, interest paid is an expense.