Which accounts are credited for outstanding Salary?

outstanding salary a/c debit and cash / Bank a/c Credit. Outstanding salary is liability for an entity, hence it is shown under the head ” Current Liabilities” in the balance sheet of an entity. Outstanding salary comes under “Representative personal account”.

What is the journal entry for outstanding Salary paid?

Outstanding salary is added to the salary and shown on the debit side of profit and loss account. It is further shown under the head current liabilities in the balance sheet. Outstanding salary is also known as Salary due (or) Salary payable.

Is paid salaries credit or debit?

Since Salaries are an expense, the Salary Expense is debited. Correspondingly, Salaries Payable are a Liability and is credited on the books of the company.

Why outstanding Salary is credit?

Expenses are booked when they are incurred and not when they are paid. Salary A/c – Increase in expense – So it is debited. Salary Outstanding – Increase in Liability – So credited. As we are liable to pay.

Which type of account is outstanding account?

The outstanding expense is a type of personal account, which carries a credit balance and thus this is treated as a liability for the business. The outstanding expense is represented on the liability side of the balance sheet of a business.

When salary is paid salary account is debited and cash account is credited because of?

Reason : Salaries Account is debited because it increases the balance of Salaries(Expenses) Account and Cash Account is credited because it decreases the balance of Cash(Assets) Account.

What are outstanding expenses accounting?

Outstanding expenses are those expenses which have been incurred and consumed during an accounting period and are due to be paid. Examples include outstanding salary, outstanding rent, etc. Outstanding expenses are recorded in the books at the end of an accounting period to show true numbers of a business.

Is paid salaries an asset?

Salaries payable is a liability account that contains the amounts of any salaries owed to employees, which have not yet been paid to them. This account is classified as a current liability, since such payments are typically payable in less than one year.

When salary paid by Cheque account is credited?

because salary is paid in Cheque/cash (it is a Real account; all assets and Liabilities come under Real account; bank balance/cash balance is an asset) ..

What is outstanding in accounts?

An Outstanding Expense is an expense which is due but has not been paid. An expense becomes outstanding when the company has taken the benefit, but the related payment has not been made.

What is the accounting treatment of outstanding salary?

Accounting Treatment Outstanding salary is added to the salary and shown on the debit side of profit and loss account. It is further shown under the head current liabilities in the balance sheet. Outstanding salary is also known as Salary due (or) Salary payable.

What is the meaning of salaries outstanding?

Salaries outstanding” or “salaries owing” or “salaries payable” is a liability and in particular an accrued expense. Outstanding salary is a representative personal account.

Is outstanding salary account a liability or asset?

Outstanding salary account represents the salary due but not paid to its employees. Thus, outstanding salary is a liability to the entity. Further, to be very specific, the Oustanding salary account is having the nature of a representative personal account as it represents a person/ group of person to whom the entity is liable to pay salary.

Where does outstanding salary go on a balance sheet?

Outstanding salary is added to the salary and shown on the debit side of profit and loss account. It is further shown under the head current liabilities in the balance sheet. Outstanding salary is also known as Salary due (or) Salary payable.