Advance Salary Journal Entry
Advance Salary is an asset
(as service is to be received in future). Advance Salary is debited in the books of
account and cash is credited. This has been shown below
Date
|
Particulars
|
Dr.
|
Cr.
|
Advance
Salary
|
$ xxx
|
||
Cash
|
$ xxx
|
Advance Salary Journal Entry Example
In the month of January,
An advance Salary of $ 2000 is paid to an employee. This transaction shall be
recorded as under. The advance salary is debited being an asset, where cash is credited due to decrease in asset.
Date
|
Particulars
|
Dr.
|
Cr.
|
Jan,2014
|
Advance
Salary
|
$ 2,000
|
|
Jan,2014
|
Cash
|
$ 2,000
|
Advance Salary Charged Expense
Advance Salary which was
recorded as an asset in the month of January shall be charged as expenses in
the month of February, as the services received in the month of February,2015. The entry for recording the expense is shown below.
Date
|
Particulars
|
Dr.
|
Cr.
|
Feb,2014
|
Salary
|
$ 2,000
|
|
Feb,2014
|
Advance Salary.
|
$ 2,000
|
The above scheme of entries can be used to record all kind of advance expenses like prepaid insurance, prepaid rent etc.
what will be advance salary account type in software
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