Journal Entries For Unbilled Legal Fees
Unbilled Legal Fees or Unbilled Legal Fees Receivable is a Current Asset for law firms, lawyers or attorneys who already provided the legal services to clients but still the bill is not invoiced or issued to them for the period. Unbilled Legal Fees is an example of Unbilled Revenue for law firms. For example, a law firm provided legal services to its client, Mr. A on 3 rd March, 2021, but the bill is issued to client, Mr. A on 10 th March, then from 4 th March to 9 th March 2021, the legal fees is treated as unbilled legal fess receivable from Mr. A against the legal advisory services, legal aids, etc. Unbilled legal fees is recorded on balance sheet as a current asset. The journal entry to record it is shown below: Note: As for a law firm, legal fees received is a direct revenue, so we can also use Unbilled Accounts Receivable Account and Sales Account instead of Unbilled Legal Fees and Legal Fees Received / Earrned respectively in the adjusting entry. ...