Daily wage expense =
Total weekly payroll / number of workdays in a week
Debits liabilities will
Credit liabilities will
It goes down
It goes up
Debit Assets will
Credit assets will
It goes up
It goes down
If a company pays rent for a full year, and records for al full year
They would debit the amount of rent expense for that current year, debit prepaid rent (assets) and credit rent expense to balance the JE
Prepaids are what
Assets!
‘Advances’ affects cash flow but do not
Affect accruals basis expense, thus making it a distractor info
Special projects fees billed and recorded for work performed requires
No adjustment and it will be billed and recorded within the completion year
Revenue should be recognized in the period in which
They were earned and realized or reliable
Expenses are recognized when an
Entity’s economic benefits are used up in delivering or producing goods, rendering services, or other activities
When dealing with classification errors
You don’t record the errors with the expenses errors
