Prepaid expenses
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
18 July 2014
Lets take a situation. An XYZ vendor has raised an invoice for Rs. 5000 for internet services provided for period of 1June - 31Aug. Lets assume today we have received bill for payment ie. 18 July. So what will be treatment in books...?
Internet Expenses A/c .....Dr....Rs.2667
Prepaid Expenses A/c.....Dr....Rs.2333
To Bank A/c...Rs. 5000
(Being internet expenses paid for period 1 june to 31Aug)
On 1 Sept we will pass entry.
Internet expenses A/c....Dr....Rs.2333
To prepaid expenses
Is this treatment correct? Pls guide.
Internet Expenses A/c .....Dr....Rs.2667
Prepaid Expenses A/c.....Dr....Rs.2333
To Bank A/c...Rs. 5000
(Being internet expenses paid for period 1 june to 31Aug)
On 1 Sept we will pass entry.
Internet expenses A/c....Dr....Rs.2333
To prepaid expenses
Is this treatment correct? Pls guide.
19 July 2014
not getting the calculation, you saying internet charges bill is for 01-06-14 to 31-08-14 that is 5000/-, on the another hand you suppose to post an entry in 1st sep.?
when you posting expenses for Jun to aug then where is question of prepaid?
when you posting expenses for Jun to aug then where is question of prepaid?
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