Prepaid rents, deposits on products, insurance premiums, and service contracts are some of the examples of deferrals. The difference between expense accruals and deferrals are summarized in the table below. The difference between revenue accruals and deferrals are summarized in the table below. Accrued revenue are amounts owed to a company for which it has not yet created invoices for. Double Entry Bookkeeping A revenue deferral is an adjusting entry intended to delay a company’s revenue recognition to a future accounting period once the criteria for recorded revenue have been met. The depreciation term is found on both the income statement and the balance sheet. On the income statement, it is listed as depreciation expense, and refers to the amount of depreciation that was charged to expense only in that reporting period. Everything in a business transaction has a debit and credit component. For example, you make a sale in March but won’t receive payment until May. The income statement, often called the profit and loss statement, shows the revenues, costs, and expenses over a period which is typically a fiscal quarter or a fiscal year. Having received the payment, the company is set to deliver the equipment between January […]