Which of the following statements is true?

a. Encumbrances are equivalent to expenditures, and encumbrances outstanding at the end of a year should be reported as liabilities.

b. No expenditure can be reported without first being encumbered.

c. Encumbrances are recorded at the estimated cost of goods ordered or services contracted for. The subsequent amount recognized as expenditures upon receipt of the goods or services must equal the encumbered amount.

d. Encumbrances are recorded at the estimated cost of goods ordered or services contracted for. The subsequent amount recognized as expenditures upon receipt of the goods or services equals the actual cost.