How is holiday accrued

how is holiday accrued

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Unearned Revenue

Understand accounting terminology. An asset is something owned by a business. Accounts receivable is an asset account that is used when a business has earned income, but has not yet collected the payment. A general journal is a list of all the transactions in a business. It has one column for debit entries and one for credit entries. A debit entry is made when an asset is increased or a liability is reduced. A credit entry is made when a liability or revenue is increased, or when an asset account is reduced.

Enter the payment for the services that have not yet been rendered. Enter the amount in the debit column of the general journal. For example, if the amount received is $600, enter $600 in the debit column of the journal. Write "Cash" in the account column.

Enter the amount of payment received in the credit column of the next row in the journal. Write "Unearned Revenue" in the account column.

Calculate the amount of revenue earned. For example, if a business receives $600 for a six-month rental, the

amount of revenue earned would be $100 each month ($600/6 months=$100 per month).

Enter the amount of revenue earned. For example, if the amount of revenue earned is $100, enter $100 in the debit column of the journal. Write "Unearned Revenue" in the account column. This entry reduces the amount of unearned revenue by $100.

Enter the amount of revenue earned in the credit column of the next row in the journal. Write "Revenue" in the account column.

Accrued Fees

Calculate the amount of revenue that has been earned but not yet recorded or billed to the customer. For example, if $1,000 of revenue has been earned, but $500 of that revenue has not yet been recorded, $500 is the amount of revenue that needs to be entered.

Enter the amount of the revenue in the debit column. Write "Accounts Receivable" in the account column. This records the amount owed to the business by the customer.

Enter the amount of the sale in the credit column in the next row of the journal. Write "Sales Revenue" in the account column of the general journal.

Source: ehow.com

Category: Bank

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