What Does Accrued Expense Mean?
An accounting expense (current liability) recognized on the company’s books before it actually is paid for. Such expenses are typically periodic and are recorded on a company’s balance sheet because of the high probability that they ultimately will be collected. Investopedia explains Accrued Expense Accrued expenses are the opposite of prepaid expenses. Typical company accrued expenses include wages, interest, and taxes. Even though they will be paid on a future date, they are recorded on the balance sheet until the moment they are paid. An example would be interest that accrues on a simple bank loan.
