Wages that have been accrued need to be recorded so that the matching principle is reflected in Wages Expense.

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Accrued wages, or wages earned but not yet paid, need to be recorded in the accounting records to reflect the matching principle. This principle states that expenses should be recognized in the same accounting period as the revenues they help to generate. By recording accrued wages as an expense, the matching principle is upheld, and accurate financial statements can be produced. Failure to record accrued wages could result in understated expenses and overstated profits, which could lead to incorrect financial decisions being made.

Wages That Have Been Accrued Need to Be Recorded So