Journal Entry of Outstanding salary and Prepaid Salary In Accounting

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Journal Entry of Outstanding salary and Prepaid Salary In Accounting

for more go to our blog Outstanding expense 

Journal Entry of Salary outstanding expense

Salary paid for the month of Jan Rs 5,000 actual salary Rs 10,000

Journal Entry for the same will be.

Salary A/c   Dr.      10,000

To cash A/c                5,000

To salary payable A/c  5000

Credit liability as Liability ADD

(being salary paid and payable salary)

Now in the month of Feb, the adjustment of salary will be made.

Salary A/c Dr.    10,000

Outstanding salary A/c Dr. 5,000

To cash A/c                           15,000

(being salary paid off last month salary)

Debit liability to deduct liability – from the business.

Journal Entry of Salay Prepaid expense

 

Salary paid for the month of Jan Rs 15,000 actual salary Rs 10,000

Journal Entry for the same will be.

Prepaid Salary A/c Dr. 5,000

Salary A/c   Dr      10,000

To cash A/c                15,000

Debit  Asset to ADD Asset + from business

(being salary paid with advance salary)

Now in the month of Feb, the adjustment of salary will be made.

Salary A/c Dr.    10,000

To cash A/c               5000

To Prepaid Salary A/c 5000

(being salary paid and adjustment of last month salary)

Credit Asset to deduct Asset – from business

Outstanding and prepaid salary in balance sheet

Outstanding salary is liability therefore it will be shown in the liability  Balance sheet.

Prepaid salary is liability therefore it will be shown in the Prepaid Balance sheet.

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Liability

Amount

Assets

Amount

Outstanding Expense

 

 

 

 

 

Liability

Amount

Assets

Amount

 

 

Prepaid Expense

 

 

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