Outstanding expenses are shown in balance sheet

The correct answer is C. Liability side of balance sheet.

Outstanding expenses are expenses that have been incurred but not yet paid. They are shown on the liability side of the balance sheet because they represent a debt that the company owes.

The trading account is a statement of income and expenses that shows the profit or loss made by a company from its trading activities. The profit and loss account is a statement of income and expenses that shows the overall profit or loss made by a company for a period of time. The asset side of the balance sheet shows the company’s assets, which are things of value that the company owns.

Here is a more detailed explanation of each option:

• Option A: In trading account. This is incorrect because the trading account is a statement of income and expenses that shows the profit or loss made by a company from its trading activities. Outstanding expenses are not included in the trading account.
• Option B: In profit and loss account. This is incorrect because the profit and loss account is a statement of income and expenses that shows the overall profit or loss made by a company for a period of time. Outstanding expenses are not included in the profit and loss account.
• Option C: Liability side of balance sheet. This is the correct answer because outstanding expenses represent a debt that the company owes. They are therefore shown on the liability side of the balance sheet.
• Option D: Asset side of balance sheet. This is incorrect because outstanding expenses are not assets. They are liabilities.