Definition of Unpaid Wages
Unpaid wages are usually the amounts that hourly-paid employees have earned, but have not yet been paid to the employees.
Entering Unpaid Wages
Under the accrual basis of accounting , unpaid wages that have been earned by employees but have not yet been recorded in the accounting records should be entered or recorded through an accrual adjusting entry which will:
- Debit Wages Expense
- Credit Wages Payable or credit Accrued Wages Payable
Wages Expense is an income statement account. Wages Payable or Accrued Wages Payable is a current liability account that is reported on the balance sheet .