Prime Purchase received a phone bill that amounts to $500 (related to calls made during 2021). Prime Purchase will pay the bill in January 2022. Cash basis : No change Accrual basis : Decrease $500 I understand that liability in "accounts payable" will increase by 500 , do we add a (500) in income statement column to compensate this? thought that since the bill is not due in 2021 we dont add the $500 expense in income statement in 2021. How else do we balance this increase in liability?