Other accrued expenses can include a variety of obligations. For example, this may include interest accrued on The Home Depot notes payable. The company presently has 6 percent senior notes out- standing that require interest payments each March 15 and September 15. Because the interest payment date does not fall at the end of The Home Depot’s fiscal year, there must be an accrual of interest from the last interest payment date through the end of the fiscal year. The company has additional obligations in the form of leases and installment notes that would require similar accounting accruals.
Accrued expenses can also include estimated liabilities that will be settled in the upcoming year. This could include property tax expense that has been assessed for the current year but will be paid in the upcoming year, a litigation loss that has been accrued for but not yet settled, or bonuses that have been earned by key executives but will be paid in the upcoming quarter. Revenues received in advance (unearned revenue), such as deposits for goods ordered by The Home Depot customers, would also be recognized as a current liability.
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