Salary payable is an accrued liability and therefore credited in the books of accounts. The journal entry for salary payable is shown below. on one hand salary is debited being the expense for the company and on other hand a liability is created with the name of salary payable.
Date Particulars Dr. Cr.
xx.xx.xxxx Salary Rs xxx
xx.xx.xxxx Salary payable Rs xxx
Example:-
Salary Payable Journal Entry
On 31 December 2014 salary for the month of December amounting Rs 20,000 to be paid in January, 2014 shall be recorded as under. Salary account shall be debited, while salary payable account will be credited.
Date Particulars Dr. Cr.
2014 Salary Rs 20,000
2014 Salary payable Rs 20,000
Salary Payment Journal Entry
In next month, when the salary shall be paid, then following entry would be recorded in the books of accounts. The liability would be removed upon payment of liability by debiting the salary payable and crediting the cash.
Date Particulars Dr. Cr.
2014 Salary payable Rs 20,000
2014 Cash Rs 20,000
The above scheme of entries can be used to record all accrued expenses. In first place the expense is debit and related liability is created and then in next stage the liability is removed , when liability is paid off.
Difference between Salary & Salary Payable
