Sandeep Sharma (Accounts executive) (552 Points)
14 June 2023
B Durga Prasad
(Student)
(175 Points)
Replied 15 June 2023
The accounting treatment for the utility bill received in advance for the month of June is as follows:
1. Upon receiving the utility bill on 25.05.2023:
Debit: Accounts Payable
Credit: Utility Expense
This entry recognizes the liability for the unpaid utility bill.
2. At the end of the accounting period (assuming it is a monthly period):
Debit: Prepaid Expense (or Accrued Expenses)
Credit: Utility Expense
This entry adjusts the expense by recognizing the portion applicable to the current accounting period (June) and recording the remaining amount as a prepaid expense or accrued expense. These journal entries reflect the proper accounting treatment for the utility bill received in advance for the month of June.
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Yasaswi Gomes new
(Finance )
(4514 Points)
Replied 16 June 2023
Since you didn't pay it
Dr. Expense
Cr. Payables
When you clear it
Dr. Payables
Cr. Bank
it it does mpact your tax, keep the bill under suspension
Yasaswi Gomes new
(Finance )
(4514 Points)
Replied 16 June 2023
I don't know if GST Is payed by company while meeting expenses. Because it makes sense doesn't it? Input tax minus out put tax.
If your company or auditors pay purchase GST or expenditure GST, then you can make an entry. I hope other members can help with this transaction.
CAclubindia
