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Accrued expense is an example of an accrual adjusting entry. It occurs when expense is incurred before cash is paid. Lets learn how to accrue salary expense. Assume Morrissey band members earn $10,000 per week. December 31 is on a Wednesday. Lets figure out how much salary needs to be accrued and then how to record the adjusting entry. If the band members make 10,000 per week, lets divide by five to get daily amount of $2000. Next, December 31st is a Wednesday, so that means we need to accrue three days of salary for a total of $6000. When we record an adjusting entry to accrue expense, we always debit an expense account and credit a liability. In this example we debit salaries expense and credit salaries payable for 6000 dollars.
