In the context of working capital an accrual is not:

A) an estimate of an obligation of the firm.
B) effectively a short term loan from the unpaid supplier of services.
C) an adjustment to the accrued depreciation account.
D) a source of spontaneous financing.

Accrual

An accounting method that records revenues and expenses when they are incurred, regardless of when cash transactions occur.

Spontaneous Financing

Financing that arises naturally from the normal operations of a company, such as trade credit that increases automatically with increases in sales.

Accrued Depreciation

The total amount of depreciation expense that has been charged against a fixed asset since it was put into use, contributing to its reduced book value.