The recognition of accrued salaries and related expenses results from the application of accrual basis accounting. Accrual accounting requires revenues to be recognized when earned and expenses when incurred. The actual receipt of or payment with cash is not essential to the recognition of revenues and expenses in the accounting records. The key issue is whether product sales have occurred and what costs or expenses relate to the sale. Salaries are accrued because they are an expense that relates to the generation of revenue in the current period.
When an accrual takes place, it is often related to a transaction that does not coincide with the close of the fiscal year or the exact amount is not yet known (in the case of a contingent liability). For example, The Home Depot mbuy sex toys online wig shop adidas yeezy 350 boost v2 bred custom nfl jerseys nike air jordan 1 low ass sex toy adidas outlet online customized baseball jerseys the rose sex toy custom jersey adidas yeezy sneakers human hair wigs for black women sex toys nfl super bowl wig outletay distribute compensation to a certain group of employ- ees on a weekly basis and others twice a month, on the 10th and 25th. Because the distribution of wage does not cover services provided by employees through the close of the fiscal year, an accrued liability for wages earned between the last payment date and the end of the year must be reported in the balance sheet. The accrued liability for salaries and other related expenses reported by The Home Depot amounts to $627 mil- lion. This amount would also include payroll taxes that the company is responsible for and would include FICA, FUTA, and SUTA payroll taxes. This amount was computed at the close of the business year and recorded via a year-end adjusting entry.