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Treatment of expenses on accrual basis
Accountancy
If salary or rent for current month becomes due on 1st of next month and is payable by 7th of next month. Then as at 31st of current month, will there be a present obligation, and should this be treated as liability as at 31st of current month? These become due on next month due to contract (legal form) and we have enjoyed using the asset or received service of employee (substance). Should we use substance over legal form and conclude there exists a liability as at 31st? or Is there no liability as at 31st? Thanks :) Video Details ------------- P1 - Advanced Accounting - Without AS Framework for Preparation and Presentation of Financial Statements #14. Capital Maintenance
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