Journal Entry for Accrued Rent

Journal Entry for Accrued Rent

Journal entry for accrued rent shall be recorded by debiting the rent expense and crediting a liability with name accrued rent. It is important to note that rent and accrued rent are two different head of account. Rent is an expense, while accrued rent is a liability. The following journal entry for accrued rent shall be recorded in the books of accounts.

Date	Particular	Ledger Folio	Dr.	Cr.
	Rent		xxx
	Accrued Rent			xxx

Accrued rent was recorded in the books of accounts under the accrual concept of accounting i.e. transactions are recorded in the books of account on the bases of their occurrence. The following rules of expense & liabilities are applied to record the accrued rent journal entry.

Rent was debiting being increase in expense, while the accrued rent was credited being increase in liability. The rules for recording the journal entries for expense and liability have been explained in my other articles.

Examples of Journal Entries Accrued Rent

1.    Rent amounting 7,500 for month of December 2016 shall be paid in January, 2017.

2.    Monthly Rent 500 Rent of building shall be paid at the end of year.

The above transaction of accrued rent may be recorded as under.

Date	Particular	Ledger Folio	Dr.	Cr.
31-12-2016	Rent		7,500
31-12-2016	Accrued Rent			7,500

The monthly rent shall be paid at the end of year shall be recorded monthly. At the end of each month the following entry shall be recorded in the books of accounts.

Date	Particular	Ledger Folio	Dr.	Cr.
31-12-2016	Rent		500
31-12-2016	Accrued Rent			500

Journal Entry for Accrued Rent paid

We know that accrued rent is basically a liability which shall be paid in future, the journal entry for payment of accrued rent would be record as under. The accrued rent shall be debited being decreasing in liability and cash shall be credited being decrease in asset.

Date	Particular	Ledger Folio	Dr.	Cr.
01-01-2017	Accrued Rent		xxx
01-01-2017	Cash			xxx