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management accounts

Harsh Jethwa (58 Points)

08 January 2019

how rent received in advance would be considered as current liability

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Ruchika Somani (Coaching and Practice in Tax Audit Law.) (4429 Points)
Replied 08 January 2019

because its not accrued income and hence may be payable before its actual due date of payment

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Harsh Jethwa (58 Points)
Replied 08 January 2019

didn't got logic behind this

RAJA P M ("Do the Right Thing...!!!") (128029 Points)
Replied 08 January 2019

Because it's not a income as not complete the transaction / rent.

Back in the Game (a) (1273 Points)
Replied 08 January 2019

I pay something to you in advance against which service interms of your building space utilization have not been availed yet. So do u own the money yet? You just the money in ur possession but do not own it unless the services of building are availed by tenant. Hence a liability

Damini Jaiswal (400 Points)
Replied 08 January 2019

Suppose, if you have received income in advance it means you have received the money but have either not delivered goods/service which you were supposed to provide. So even though you have received money you are still liable to provide goods/service. Hence that becomes your liability.

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