Journal Entry for Receiving a Utility Bill to Be Paid Next Month
When a business receives a utility bill that is to be paid in the next month, it needs to record the liability as an expense and an accounts payable entry. Here is the journal entry for this transaction:
| Date | Particulars | Debit (₹) | Credit (₹) |
|---|---|---|---|
| 2024-06-07 | Utility Expense A/c | 5,000 | |
| To Accounts Payable A/c | 5,000 | ||
| (Being utility bill received, payable next month) |
Explanation:
- Utility Expense A/c is debited because it represents the cost incurred for utilities.
- Accounts Payable A/c is credited because it represents the liability to pay the utility bill in the next month.
