Accrual
An accrual occurs when an expense or revenue is incurred, but the money is not yet paid/received.
Deferral
A deferral occurs when money is paid/received, but an expense or revenue are not yet incurred.
Here's a GREAT visual summary:
Your JE Blog is a place for high school students taking accounting and business courses to connect, learn, share ideas, and get help with school work and career decisions.
Friday, 6 September 2013
Accrual vs. Deferral
Students often confuse the two concepts, so I thought I'd write a blog to help distinguish between the two.
Accrual
An accrual occurs when an expense or revenue is incurred, but the money is not yet paid/received.
Deferral
A deferral occurs when money is paid/received, but an expense or revenue are not yet incurred.
Here's a GREAT visual summary:
Accrual
An accrual occurs when an expense or revenue is incurred, but the money is not yet paid/received.
Deferral
A deferral occurs when money is paid/received, but an expense or revenue are not yet incurred.
Here's a GREAT visual summary:
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