Accrual Accounting Explained: Definition, Pros, Cons, & More
The accrual adjustment will debit the current asset account Accrued Receivables and will credit the income statement account Accrued Electricity Revenues. At the end of the month, when the company receives payment from its customers, receivables go down, while the cash account increases. If companies incurred expenses (i.e., received goods/services) but didn’t pay for them