Hi Friends,
I have doubt reagarding "Prepaid Expenses"
Question
1) Preapaid Insurance of Monthly is Rs 30,000 and please pass the entries for the 12 months. Please clarify my doubt.
Advance Thanks
Sathish
M.SATHISHKUMAR (Audit) (68 Points)
03 July 2017Hi Friends,
I have doubt reagarding "Prepaid Expenses"
Question
1) Preapaid Insurance of Monthly is Rs 30,000 and please pass the entries for the 12 months. Please clarify my doubt.
Advance Thanks
Sathish
Karan Batra
(Creator: TheProTalks)
(2325 Points)
Replied 03 July 2017
Whenever you pay any expense as prepaid it means you are paying it in advance and it will gather you future cash inflows thus till the time actually comes to treat it as an expense, it is categorised to ve an asset.
1
|
Prepaid expense A/C Dr. |
Amount Paid |
To Bank |
||
2
|
Expense A/C Dr. |
Amount Written off as expense on time basis/or usage basis |
To Prepaid expense A/C |
||
3
|
SPL A/C Dr. |
Amount Written off charged in SPL |
To Expense A/C |
Rama chary Rachakonda
(Master in Accounts & Lawyer email ID:ramachary64@gmail.com voice no:9989324294)
(3368 Points)
Replied 22 July 2017
The period of the month recording also is important. Debit prepaid expenses at the end of the each month. When the expenses paid is required the exact of date of payment in the voucher/bill etc.
RAJA P M
("Do the Right Thing...!!!")
(127921 Points)
Replied 01 August 2017
RAJA P M
("Do the Right Thing...!!!")
(127921 Points)
Replied 01 August 2017
Live class on PF & ESI Enrollment & Returns Filing(with recording)