Accrued Expenses

Accrued Expenses are when a company puts down costs on its balance sheet before they actually pay them. This is usually because the liability is frequent and regular (i.e. wages). The reason the company can claim this as liabilities in advance is because there is a very high probability that they will be paid. Accrued Expenses are found on the Balance Sheet under Current Liabilities.

Free Resources

To continue learning and advancing your career, check out these additional helpful WSO resources:

• Retained Earnings
• Fraud Triangle
• Accounts Receivable Turnover Ratio
• Marginal Cost Formula
• Nash Equilibrium