our office have office insurance Rs.6,590/- and our office assistant accident insurance Rs.165/- for one year premium. please tell me how the amount calculate on above mentioned insurance prepaid insurance for my knowledge.
22 August 2009
Calculate the insurance amount on pro rata basis..... i.e. period which falls in the accounting year will be booked for expense and period which falls outside the accounting year will be prepaid expense
i.e. 6590 * no of days during the year for which insurance period was valid / 365
the above amount will give u amount to be charged to P&L and balance will be prepaid expense... Same goes for the other case
CAclubindia
