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Accruals

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Glossary  -> Accruals

Accruals

When the accrual basis of accounting is used, accruals are done at the end of an accounting period (usually monthly) to record costs which have been incurred but not paid for or previously recorded, and to record revenue which has been earned but not received or previously recorded.

The entry to do this would be a debit to an expense account or asset account, and a credit to an accrued liability account.  Once the cost has been paid, the accrual would be reversed.

 

Revised: February 23, 2016

 

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