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They don't reflect real liabilities in the sense that TKLC will never pay cash out to someone for those items.

For both they WILL pay out cash to someone. Accrued Expenses are expenses that have occured just haven't been paid. With Deferred Revenues TKLC has been paid but has yet to provide the services or goods. When they do provide the goods or services in the future there will be the usual expenses incurred.

So the full amount of Deferred Revenue doesn't represent future cash outflow but some/most of it does (maybe equal to the usual Cost of Goods Sold %?).

That is my take.

Ryan
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