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Hi! Iamp;#39;m Jonathan Wild. In this video, we cover how to record adjusting entries for accrued expenses and accrued revenues. Accrued expenses or accrued liabilities are costs that are incurred in a period that are both unpaid, and unrecorded. So, for example, assume a company has a single employee that earns $300 per day, also because weamp;#39;re a great boss we pay our employee every Friday. Now, also assume this year that our year end December 31st falls on a Tuesday. And so, by Tuesday the employee has earned two days of wages, but will not be paid until Friday of next year. Because the employee has earned those wages, but has not yet been paid, we must record an adjusting entry for 600 of wages expense, computed as 300 per day multiplied by two days. The adjusting entry on December 31st would include a debit to wages expense for 600 and a credit to wages payable for 600. We debit wages expense to record the expense of those two days worked by the
