Have you ever encountered accounting types that say costs have arisen? A few years ago, I told someone about accumulating costs and being hurt. I have to tell her that some accumulation is not a horrible thing … Basically, the cost is to recognize the transaction before it has been paid or you have to pay the billing system. In order to accumulate, the costs of this period also occurred. If you have now used the service or purchased goods, you will now recognize this cost.
The delimitation is usually made when the books are in the closed state, sometimes every month, and of course at the end of the year. For example, accrued expenses may be:
* Wage paid for work, but the future paid – very common
* Sales Committee that has just happened but the future
* Utilities used this period but the
* Purchase of paper used for this period but payable in the future
* Expenditure incurred during the period but incurred in the future
to include the expense in the profit and loss account, corresponding to the same period in the income statement a.
Accountants often use deferred expenditures. This can happen if you do not know how much it will cost. Accountants generally look at accumulated spending for an earlier period in order not to forget all transactions. For example, if you are aware of insurance cost accounting, for example, you know that your insurance costs may also be incurred.
Sometimes businessmen get confused between budget numbers and delimitations. No expense is generated, just because it is budgeted. It's partly due to the fact that the transaction actually took place during the period. This means that differences in budget and actual expenditure can be explained by accrued expense
Technically accountable expenditure accrued for the registration of the periodical below:
Debit – In the profit and loss account Different types of expenditure
Loan – Accountable Cost Accounts, Accounts in Balance Sheet
When the accrued expense is paid, the journal entry is:
Credit – Cash
that the expense is recorded in the accrual basis, and again when the bill is placed in the accounting system. In order to avoid double booking, the original accrual-based entry will be reversed as the bills are disbursed. It can be time-consuming and bug fixer, but it's a traditional way to not recognize the same issue twice.
Source by sbobet