Which entry is correct?
Salary A/c ... Dr
To Bank A/c
OR
Salary A/c .... Dr
To Salary Payable A/c
Salary Payable A/c ..... Dr
To Bank A/c
Why do we need to first Due the expense and then Pay it, for what kind of items we make the same treatment?
Please solve.
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Journal Entry query
Replies (5)
Second is correct because, it records that payments are made to employees under payables
If you follow cash basis in accounting first one is correct, if you are following accrual basis in accounting second one is correct.
Second is correct as per accrual basis
Second entry is correct
We follow accrual concept , so second is correct
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