Accrued Expenses Journal Entry:
Debit or Credit?
by Anonymous
(Unknown)
Question:
Q: If the amount has been debited into accrued expenses, do we need to credit it after making the payment (so that the balance would be zero in accrued expenses)?Answer:

Accrued expenses are not expenses .
Accrued means "owed" or "owing."
Accrued expenses is a liability account . It means expenses that are owing or payable.

Recording Accrued Expenses
When you have an accrued expense, you record the following:Dr Expense
Cr Accrued Expenses (liability account)
When you make the payment you record:
Dr Accrued Expenses
Cr Bank
The entries above are the standard, usual entries for an accrued expense and then paying off the debt.
Debit Entry for the Accrued Expenses Account
Apart from when you're making the payment, a debit to the accrued expense account is highly unusual as it means you owe less . In this case you would need to do a correction.For example, let's say that at the end of the month you had salaries payable $40,000 and you originally recorded this (incorrect) entry:
Dr Salaries payable (liability) .................... $40,000
Cr Salaries (expense) ........................................ $40,000
In this situation you would pass a journal entry to correct this, which is the exact opposite of the above:
Dr Salaries (expense) ................................. $40,000
Cr Salaries payable (liability) ........................... $40,000
That's it! Hope that gives you a better understanding of the journal entries for accrued expenses and when to debit or credit this account!
Add a comment further below to let us know what you thought of this explanation (or if you have questions on this topic).
Best,
Michael Celender
Founder of Accounting Basics for Students
Related Questions and Tutorials:
- Accrued Expenses and Revenue: Closed or Not?
- What is an Outstanding Salary?
- Accounts Payable Journal Entries (Full Tutorial)
Return from Debit or Credit Accrued Expenses? to Basic Accounting Questions
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