Journaling Accrued Salaries Expenses

matching principle

aims to record expenses in the same accounting period as the revenues that are earned as a result of these expenses.

Paid Salaries

Assets (Cash) decrease, Equity decreases (as Sal Exp. goes up) Debit Salaries Exp.; Credit Cash

To record payment of accrued expense

Assets (Cash) decrease, Liab (Sal Payable) decrease DB Salaries Payable; CR Cash

To accrue salaries expense

Liabilities (Salaries Payable) increase, Equity decreases (as Sal Exp. goes up)Debit Salaries Exp.; Credit Salaries Payable

Accrued Expenses

must be reported on the income statement of the period when incurred.