Prepayments

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Some payments (expenses)  are made in advance. Example monthly seasons parking for the month of January to March is paid in January, February and March as payments in advance.  


At [A/c Entry] , click [Payment]

 

 

Click [Others]

       

 

Assuming the monthly parking charge is 80.00 per month, accounting entries are as follows

 

 

COA

Debit

Credit

Prepayment

D-P004-1

240.00

 

Input tax

D-G098

16.80

 

Bank

D-B001-1

 

256.80

(Being season parking for Jan, Feb, Mar 2020,prepayment for Feb and March 2022)

 

                                                                 

 

 

In January 2022, reverse the prepayment entry to parking expenses

 

 

COA

Debit

Credit

Parking expenses

O-P004-1

80.00

 

Prepayment

D-P004-1

 

80.00

 

At [A/c Entry], click [GL Journal]

 

 

For February and March, use [Copy] to repeat the reversal

 

Next, go to Provision for bad debts

 


Related Topics

 

 

 

 

 

 

 

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http://realtimme.cloudapp.net/basic/index.html?gl_prepayments.htm