An adjusting entry to accrue expenses is necessary when there are unrecorded expenses and liabilities that apply to a given accounting period. These expenses may include wages for work performed in the current accounting period but not paid until the following accounting period and also the accumulat...
an adjusting journal entry is recorded at the end of the accounting period for the last month’s expense. The adjusting entry will be dated Dec. 31 and will have a debit to the salary expenses account on the income statement and a credit to the salaries payable account on the balance shee...
Adjusting Entries for Prepaid Expenses Sometimes, expenses are paid before a service or product is received. A common example is the prepayment of insurance premiums for a multi-month period. For example, if your business pays the full premium for an auto insurance policy of six months in Janua...
Definition An expense that has occurred but the transaction has not been entered in the accounting records. Accordingly an adjusting entry is made to debit the appropriate expense account and to credit a liability account such as Accrued Expenses Payable or Accounts Payable. To learn more, seeExpla...
Section3 ACCRUEDEXPENSES(ACCRUEDLIABILITIES) Introduction Accruedexpensesareexpensesthathavebeenincurred,butnotyetpaidfor. Toputitanotherway,anaccruedexpenseispaidafterbeingrecordedon thebooks.Everyadjustingentryforaccruedexpensesdebitsanexpense account,increasingexpensesontheincomestatementandreducingnet income,andcredit...
Advantage of Accrued Expense Journal entry Journal entry for accrued expenses comes into play when there is no expense documentation. In such a case, a journal entry is made to recognize the accrued expense in the income statement. Also, an adjusting entry is made to record the expense as a...
内容提示: Section 3ACCR UE D E XPE NSE S (ACCR UE D L IABIL IT IE S)IntroductionAccrued expenses are expenses that have been incurred, but not yet paid for.To put it another way, an accrued expense is paid after being recorded onthe books. Every adjusting entry for accrued expenses...
A.Making the adjustment entry for depreciation expenses twice. B.Failure to record interest accrued on a note payable. C.Failure to make the adjusting entry to record revenue which had been earned but not yet billed to clients. D.Failure to record the earned portion of fees received in advan...
Explain when costs should be recognized as expenses. Describe what is meant by the term balance sheet equation. What is an accrued expense? Provide an example. Describe the adjusting entry that would be recorded to account for inventory shrinkage. ...
an adjusting journal entry is recorded at the end of the accounting period for the last month’s expense. The adjusting entry will be dated Dec. 31 and will have a debit to the salary expenses account on the income statement and a credit to the salaries payable account on the balance shee...