- Accrued revenues: When a company earns revenue before receiving cash, it should record an accrued revenue. For example, if a company sells a product on credit, it should record the sale as an accrued revenue on the date of the sale.
- Accrued expenses: When a company incurs an expense before paying cash, it should record an accrued expense. For example, if a company uses up supplies before paying for them, it should record an accrued expense for the supplies on the date they are used.
- Prepaid expenses: When a company pays for an expense in advance, it should record a prepaid expense. For example, if a company pays rent for the next month, it should record a prepaid expense for the rent on the date it is paid.