What is the difference between deferred cost and accrued cost?

Answer 1

Accrued costs are costs for services or materials received, but for which payment has not been made. Example - you order 1600 cubic yards of concrete. It is delivered to your site in 16 weekly increments of 100 cubic yards. You receive a bill at the end of the 16 weeks. The accrued cost reflects the cost of concrete delivered in a reporting period prior to receiving the bill. This is money that should be set aside (and costs to balance against earned value for the material).

Deferred cost are for services or materials not yetreceived, but for which payment has been made. Example - you purchase a plane ticket 6 weeks before a planned trip. The cost is incurred, but reporting may be deferred until the trip is made and value is earned.