AAT Level 3 - Accruals - How to Account for Accrued Expenses

Within this video I show you how to apply the accruals concept to expenses. I'll be running through how to account for accrued expenses, the bookkeeping entries and the reason for each entry.
If you've enjoyed this video you may find the following other videos useful to further your understanding on the accruals concept:
Accrued Income:
• AAT Level 3 - Accruals...
Prepaid Expenses:
• AAT Level 3 - Prepayme...
If you have any questions drop them in the comments below or email:
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[@MuhammadAli-yr5hv]

The man, hype this guy up, way easier to understand rather than a 3hr long video

[@bluu_04]

Thank you so soo much! I can finally understand Accrual and reversal. You're a hero

[@liamgarfield7934]

In the year that the work actually took place the accrual is a expense in the profit and loss and a liability in financial position I hope I'm right in saying, when you do the reversal accruals is this to only cancel that accrual out in those accounts and its not included in any financial statements for the reversal year?

[@Willboardman]

That is correct yes, so the reversal will mean that you're effectively starting the year with a negative balance in the account. The reason being that when the invoice then comes in it will be entered into the expense account to offset against that negative balance bringing it to zero. Which is what you want because the expense at this point would have related to the previous year.

[@GoogleVictoria]

Am I correct in saying, monthly invoices, due after the period, will be reversed out the following month and a new entry will be made for the current month? For example, if electricity is billed monthly and we usually pay £100, would I accrue May's bill in May's MI/MA (amount due in June) then reverse it in June's MA, but also accrue June's bill? I hope this makes sense