Help - quick question

JenaatJenaat Just JoinedPosts: 3Registered
Hi all

Im just doing some notes for how to do the income statement and balance sheet and have a few queries (sorry there a bit basic)

Income Sheet

Carriage In
Carriage Out

How are these treated? What are they added onto/deducted from?

Balance Sheet

Prepayments - where are these accounted for - are they added onto the trade receivables?

Help please - i want to make sure what ive put in my notes is correct

thanks in advice

jenny

Comments

  • BluewednesdayBluewednesday Font Of All Knowledge Posts: 1,624Registered
    Carriage in is usually part of the cost of sales figure as it is necessary for bringing the purchases into the business.

    Carriage out is an expense in the bottom of the income statement.

    Prepayments are an asset and are not added to trade debtors but listed as a current asset.
  • JentelJentel Feels At Home Posts: 60Registered
    Re prepayments on the balance sheet - it is added onto 'Trade & other receivables' and not listed separately.
  • BluewednesdayBluewednesday Font Of All Knowledge Posts: 1,624Registered
    Go by what AAT do but in any accounts I have seen, prepayments are listed separately under current assets.

    i.e. Current assets

    Trade receivables
    Prepayments and deferred income
    Cash at bank
    Cash at hand

    That's also the way my corporation tax program lists it.

    I don't think you would lose marks if you did it this way though!
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