Answer TRUE or FALSE in respect of the following and fully explain your choice:

If an accrued expense is ignored at the year end the profit will be understated.

If an accrued expense from the previous period is not carried forward into the current year the profit for the current year will be understated.

An accrued expense is an expense that has been paid but not used up in generating revenue.

A prepayment is an expense that has been paid but not used up in generating revenue.

When adjusting a ledger account for an accrued expense, you debit the account with the accrual before balancing and bring down a credit balance.

An accrued expense is an asset.
An accrued revenue item is an asset.
Bad debts and provision for bad debts