Accrued and Deferred Income and Expenditure Journals

Michael Brown

10 years ago

The accrued and deferred income and expenditure journals below act as a quick reference, and set out the most commonly encountered situations when dealing with the double entry posting of accruals and deferrals.

Accrued and Deferred Income and Expenditure Examples

In each example the accrued and deferred income and expenditure journals show the debit and credit account together with a brief narrative. For a fuller explanation of accrued and deferred income and expenditure journals, view our accruals and deferrals tutorial.

Accrued Revenue and Expenditure Journals

Revenue

Accrued revenue journal entry
Account	Debit	Credit
Accrued revenue	XXX
Revenue		XXX

Expenditure

Journal entry for accrued expenses
Account	Debit	Credit
Expenses	XXX
Accrued expenses		XXX

Deferred Revenue and Expenditure – Asset and Liability Method

There are two methods of recording revenue and expenditure deferrals, this first is the asset and liability method shown immediately below, and the second is the revenue and expenses method detailed later in this post.

Revenue

Deferred revenue – Cash received
Account	Debit	Credit
Cash	XXX
Deferred revenue		XXX

Deferred revenue – Adjusting entry
Account	Debit	Credit
Deferred revenue	XXX
Revenue		XXX

Expenditure

Deferred expenditure journal entry – Cash paid
Account	Debit	Credit
Deferred expenditure	XXX
Cash paid		XXX

Deferred expenditure journal entry – Adjusting entry
Account	Debit	Credit
Expense	XXX
Deferred expenditure		XXX

Deferred expenditure is sometimes referred to as prepaid expenditure or simply prepayments.

Deferred Revenue and Expenditure – Revenue and Expense Method

This is the second method of posting deferred revenue and expenditure, the first is the asset and liability method shown in the section above.

Revenue

Deferred revenue – Cash received
Account	Debit	Credit
Cash	XXX
Revenue		XXX

Deferred revenue – Adjusting entry
Account	Debit	Credit
Revenue	XXX
Deferred revenue		XXX

Expenditure

Deferred expenditure journal entry – Cash paid
Account	Debit	Credit
Expense	XXX
Cash paid		XXX

Deferred expenditure journal entry – Adjusting entry
Account	Debit	Credit
Deferred Expenditure	XXX
Expense		XXX

Deferred expenditure is sometimes referred to as prepaid expenditure or simply prepayments.

Last modified November 26th, 2019 by Michael Brown

About the Author

Chartered accountant Michael Brown is the founder and CEO of Double Entry Bookkeeping. He has worked as an accountant and consultant for more than 25 years in all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a BSc from Loughborough University.