Are outstanding expenses income or expenses ?

by rajiv
(Nepal)

From Ask the Expert!


Are outstanding expenses income or expenses ?

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By 'outstanding expenses' do you mean bills that you owe that you haven't paid yet?

If you're using a strict 'cash basis' system, you would not show these as an expense yet on your Income Statement.

If you're using an 'accrual method' system, then you would post your unpaid bills as expenses, and instead of posting the credit to cash, post to Accounts Payable (a liability account).


Hope that helps.

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