UrbanPro
true

Take Class 12 Tuition from the Best Tutors

  • Affordable fees
  • 1-1 or Group class
  • Flexible Timings
  • Verified Tutors

Accruals Accounting

Nitin Saraswat
24/07/2020 0 0

Accruals in Accounting are the expenses or revenues that have been recorded by the firm but not yet realised. In simple terms, they are the financial transactions already estimated in the current accounting cycle and payment for which is done in the future.

Let’s look at a few practical accrual accounting examples.

Example 1: Salaries Payable

On 31 December 2020 salary for December amounting, Rs 20,000 to be paid in January 2021 shall be recorded as under. Salary account shall be debited (accounting rule: debit all expenses), while salary payable account will be credited (Liability created).

31/12/2020 Salary Expense A/c Dr. 20,000  
  Salary Payable A/c Cr.   20,000

 

Example 2: Rent Receivable

On 31 December 2020 rent for December amounting Rs 20,000 to be collected in January 2021 shall be recorded as under. Rent Receivable account shall be debited (Asset created: to be received), while Rent Income account will be credited (accounting rule: all income and gains should be credited).

31/12/2020 Rent Receivable A/c Dr. 20,000  
  Rent Income A/c Cr.   20,000

 

0 Dislike
Follow 2

Please Enter a comment

Submit

Other Lessons for You

Introduction To Accounting: Part 8: Accounting Concepts
In order to make the accounting language convey the same meaning to all people and to make it more meaningful, most of the accountants have agreed on a number of concepts which are usually followed for...

Bank Reconciliation Statement
In the given chapter to solve a sum we are given a cash book and another thing is bank pass book. and there is some miss match so we need to come to a conclusion that the same miss match is. We can...
T

Difference between Book-Keeping and Accounting/Accountancy, Class 11
Helpful for NCERT/CBSE, State Board, ICSE Class 9, ISC, IGCSE/GCSE

Chapter 1 - Introduction to Accounting
History of Accounting : Before knowing the history of accounting, let us know about the history of money which is the basis of the accounting process. Money : Item or verifiable record accepted for...
D

This website uses cookies

We use cookies to improve user experience. Choose what cookies you allow us to use. You can read more about our Cookie Policy in our Privacy Policy

Accept All
Decline All

UrbanPro.com is India's largest network of most trusted tutors and institutes. Over 55 lakh students rely on UrbanPro.com, to fulfill their learning requirements across 1,000+ categories. Using UrbanPro.com, parents, and students can compare multiple Tutors and Institutes and choose the one that best suits their requirements. More than 7.5 lakh verified Tutors and Institutes are helping millions of students every day and growing their tutoring business on UrbanPro.com. Whether you are looking for a tutor to learn mathematics, a German language trainer to brush up your German language skills or an institute to upgrade your IT skills, we have got the best selection of Tutors and Training Institutes for you. Read more