Accrued expenses refer to what type of obligation?

Accrued expenses are a type of liability that reflects money owed to external parties for services or expenses that have already been incurred but not yet paid for. This means that while the expense has been recognized in the accounting records, the actual cash payment has not been made, creating an obligation that the entity must fulfill in the future. This concept is crucial in accrual accounting, where expenses are recorded when they are incurred rather than when they are paid.

In contrast to the other choices, which either describe future obligations for services not yet rendered or pertain to payments made or income recognized, accrued expenses specifically highlight the timing and recognition of expenses that are recognized in the financial statements, thereby accurately reflecting the company's financial position and obligations at a given point in time.