Journal Entry for Accrued Income
It is income earned during a particular accounting period but not received until the end of the same accounting period. Accrued income is also known as outstanding income and income earned but not received.
As per accrual-based accounting income must be recognized during the period it arises irrespective of when the money is received. Accrued income acts as an asset and its journal entry considers the rule “debit the increase in assets” (modern approach of accounting).
Journal entry for accrued income is
|Accrued Income A/C||Debit|
|To Income A/C||Credit|
Let’s assume that in March 30,000 due to be received as rent wasn’t received due to some reason. To record rent earned but not received in the annual statements for the period ending March 31,
Journal entry for accrued rent will be
|Accrued Rent A/C||30,000|
|To Rent A/C||30,000|