Outstanding expenses are shown in balance sheet

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.