accrued expense define accrued expense
accrued expense. Definition. An expense that is incurred, but not yet paid for, during a given accounting period. “ I have an accrued expense while I was on my work trip in several countries during the past several months. accrued expense. Definition. An expense that is incurred, but not yet paid for, during a given accounting period. Use accrued expense in a sentence. “ I have an accrued expense while I was on my work trip in several countries during the past several months. Video: Accrued Expenses & Revenues: Definition & Examples. Accruals are a part of the accounting world for most businesses. In this lesson, you will learn about two important parts of the concept of accruals: accrued revenue and accrued expenses. The term accrual also often used as an abbreviation for the terms accrued expense and accrued revenue that share the common name word, but they have the opposite economic/accounting characteristics. Accrued revenue: revenue is recognized before cash is received. Accrued Expenses and Revenues Definition. Most of the time, when we think about accounting, we think about the cash-basis method of accounting where revenue is recorded when cash is received and expenses are recorded when bills are paid. This isn't the only method of accounting, and most certainly not the one most businesses use. The most common method of accounting used by businesses is accrual-basis accounting. Two important parts of this method of accounting are accrued expenses and accrued revenues. Accrued expenses are expenses that are incurred in one accounting period but won't be paid until another. 1. 1  an expense incurred but not yet paid, as accrued interest on notes payable. 2  an expense incurred but not yet paid, as accrued interest on notes payable. Origin of accrued expense. 1980-1985. First recorded in 1980-85. Accrued Expense. Accrued expense is expense which has been incurred but not yet paid. Expense must be recorded in the accounting period in which it is incurred. Therefore, accrued expense must be recognized in the accounting period in which it occurs rather than in the following period in which it will be paid. Accrual Accounting. Loading the player... What is 'Accrual Accounting'. Accrual accounting is an accounting method that measures the performance and position of a company by recognizing economic events regardless of when cash transactions occur. Accrual (accumulation) of something is, in finance, the adding together of interest or different investments over a period of time. It holds specific meanings in accounting, where it can refer to accounts on a balance sheet that represent liabilities and non-cash-based assets used in accrual-based accounting.
Accrued expense is expense which has been incurred but not yet paid.