Accrued Expense

Intermediate 💰 Finance / Accounting

Definition

A cost you've incurred but haven't paid for yet—basically expenses you owe but haven't got the bill for.

Example Usage

We accrued a bonuses for our team even though we'll pay them in January.

Origin

Accrual accounting standard

Fun Fact

Accrued expenses can be used to smooth out earnings by timing when you 'accrue' costs

Source: GAAP accounting standard

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