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Accounts Payable are supported by invoices or billing statements. Accrued Expenses are expenses which relate to the current period; however, there is not an invoice on hand. For example, the company lawyer bills the company for his services on an invoice on the 15th of each month, you would post his invoice in Accounts Payable and accrue legal fees for the 16th to the end of the month.
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What is the journal entry to record an accrued exp?
debit: expense account credit: account payable (vendor)
Distinguish between the two categories of adjusting entries and identify the types of adjustments applicable to each category?
Deferrals are either prepaid expenses or unearned revenues. Adjustments are made for deferrals to record the portion that represents either the expense incurred or the revenue earned. An adjustment for prepaid expenses increases an expense and decreases an asset account. An adjustment for unearned revenue increases a revenue account and decreases a liability account. Accruals are either accrued revenues or accrued expenses. Adjustments are made for accruals to record revenues from services performed that have yet to be collected. An adjustment for accrued revenues increases an asset account and increases a revenue account. An adjustment for accrued expenses increases an expense account and increases a liability account.
What is the journal entry to record accrued interest expense?
Debit Accrued Interest Expense Credit Accrued Interest Payable
What is the difference between office supplies account and office supplies expense account?
Office supplies acct is an account that you book as payables and a offfice supplies expense account is a Liability Account on your Chart of accounts
What is the accounting entry for Accrued Expense?
Dr. Accrued Expense Cr. Cash or Cash in bank
Is accrued expense a financial liability?
If you are doing adjusting entries, an accrued expense will affect a balance sheet account (payable) and an income statement account (expense). Such as accrued interest at the end of year would be: Interest Expense (Debit) Interest Payable (Credit)
What is the journal entry to reverse an accrued expense?
Payable Account XXX Expense Account XXX
Is electricity a liability or asset?
Electricity expense is an expense account while accrued electricity payable is a liability account
What is the journal entry to record an accrued exp?
debit: expense account credit: account payable (vendor)
What are accrued expenses reported on the balance sheet as?
As you accrue expenses, they show up as a CREDIT on the balance sheet, and a DEBIT on the income statement. Then as you actually incur the expense and pay out, you would CREDIT your cash account, and DEBIT the accrued liability account on the balance sheet. For example, if you expect to spend $12,000/year on business travelling expenses, you would accrue $1000 monthly as a CREDIT to your accrued liability account (on the balance sheet), then a DEBIT to the expense account (on the income statement). When you actually do incur the expense and pay out, you CREDIT your cash account, and DEBIT the accrued liability account. Thus, the accrued liability account is cleared out and eventually washed out to zero.
Journal entry to record an accrued vacation expense?
Though I have never heard the term "accrued vacation expense" nor have I ever heard of a "vacation" being a business expense, however, the journal entry would be handled like most "payables". So if your company uses the account of Accrued Vacation Expense, the journal entry should be something like....Vacation Expense (debit) $XXXAccrued Vacation Expense (credit) $XXXOnce the amount is paid, a debit would be recorded in the Accrued Vacation Expense account and a credit to Cash, to remove it from the books and note that the debt (or expense) has been met.
Distinguish between the two categories of adjusting entries and identify the types of adjustments applicable to each category?
Deferrals are either prepaid expenses or unearned revenues. Adjustments are made for deferrals to record the portion that represents either the expense incurred or the revenue earned. An adjustment for prepaid expenses increases an expense and decreases an asset account. An adjustment for unearned revenue increases a revenue account and decreases a liability account. Accruals are either accrued revenues or accrued expenses. Adjustments are made for accruals to record revenues from services performed that have yet to be collected. An adjustment for accrued revenues increases an asset account and increases a revenue account. An adjustment for accrued expenses increases an expense account and increases a liability account.
Is salary expense liability?
Salary expense is not a liability - it is an expense; however, if salaries are accrued between periods, there will likely be a liability account named "Accrued Salaries" or "Salary Due."Associated with salaries; however, are various taxes. Those taxes are not necessarily submitted to government entities at the same time as the salary is paid to employees. There will likely be liability account(s) associated with those taxes.
What is the journal entry to record accrued interest expense?
Debit Accrued Interest Expense Credit Accrued Interest Payable
What is the difference between office supplies account and office supplies expense account?
Office supplies acct is an account that you book as payables and a offfice supplies expense account is a Liability Account on your Chart of accounts
What are the examples of accrued expenses?
Accrued expense refers to an expense that has been incurred but not yet paid. Examples of accrued expense items might be interest that has accrued on an outstanding note that has not been paid, and taxes that have accrued but not yet been paid.
Is it true that in recording the adjusting entry for accrued taxes both accounts involved are increased?
Yes, as the expense and the corresponding liability accumulate over the period, an adjusting entry is necessary to increase the expense (with a debit) and increase the corresponding liability (with a credit).
