accrual method


An accounting method that requires income or expenses to be entered when the income is earned or the payment is payable. For example, if a property owner purchases a three-year insurance policy, under the accrual method, only the first year's insurance expense is shown as a journal entry, even if the property owner pays the entire balance in full.

Mentioned in these terms

Browse by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
wage expense accrual basis accounting