Thursday, July 3, 2014

Accrual meaning and Expense & Income Accrual Entries.....

Accrual—accrual-basis recognition precedes cash receipt and expenditure

(1) Revenue—recognition of revenue earned, but not received
(2) Expense—recognition of expense incurred, but not paid

Accounting Example :

Expense Accruals 

Wages expense Account  Dr xx
         To Wages payable Account xx 

Reversal Yes