Salaries in arrears is treated in the balance sheet as a
Answer Details
Salaries in arrears is treated as a current liability in the balance sheet. This means that it represents a debt or an obligation that a company owes to its employees for work that has already been done but not yet paid for.
When a company has salaries in arrears, it means that they have not paid their employees their full salary for the current accounting period. This could be due to a delay in payment processing, an error in calculation, or other reasons.
Since the payment of the outstanding salaries is expected to happen within a short period of time (usually within the next accounting period), it is considered a current liability. It is listed on the balance sheet under the current liabilities section, along with other short-term debts that the company owes, such as accounts payable, taxes payable, and other accrued expenses.
It's important to note that once the company pays the outstanding salaries, the amount of the liability will be reduced and it will no longer appear on the balance sheet.