Help
Tracie1977
Registered Posts: 2 New contributor 🐸
I am current studying Diploma level 3 and i am a little stuck if anyone can help
I am trying to produce an income statement from limited informatation and i am a little stuck on the below: -
The income statement is dated 31 May 2010
On the 1 June 2009 i am told that prepayments for insurance stands at 15000
On the 31 May 2010 im am told that the balance for insurance stands at 25000
Where does the prepayment from the end of the previous year fit in with the income statement for the current year.
Anyones help would be much appreciated :001_smile:
I am trying to produce an income statement from limited informatation and i am a little stuck on the below: -
The income statement is dated 31 May 2010
On the 1 June 2009 i am told that prepayments for insurance stands at 15000
On the 31 May 2010 im am told that the balance for insurance stands at 25000
Where does the prepayment from the end of the previous year fit in with the income statement for the current year.
Anyones help would be much appreciated :001_smile:
0
Comments
-
Assuming no adjustments have yet been made:
The prepayment from the prior period relates to this period and so needs to be removed: dr insurance cr prepayments 15,000. This leaves the insurance expense at 40,000 in the P&L. Of course there may be a new prepayment that's already been made relating to the next period, in which case you would dr prepayments and cr insurance expense.0 -
Many thanks for your help, now it make sense. Much appreicated :thumbup1:0
Categories
- All Categories
- 1.2K Books to buy and sell
- 2.3K General discussion
- 12.5K For AAT students
- 325 NEW! Qualifications 2022
- 160 General Qualifications 2022 discussion
- 11 AAT Level 2 Certificate in Accounting
- 56 AAT Level 3 Diploma in Accounting
- 95 AAT Level 4 Diploma in Professional Accounting
- 8.9K For accounting professionals
- 23 coronavirus (Covid-19)
- 273 VAT
- 92 Software
- 274 Tax
- 138 Bookkeeping
- 7.2K General accounting discussion
- 202 AAT member discussion
- 3.8K For everyone
- 38 AAT news and announcements
- 345 Feedback for AAT
- 2.8K Chat and off-topic discussion
- 582 Job postings
- 16 Who can benefit from AAT?
- 36 Where can AAT take me?
- 42 Getting started with AAT
- 26 Finding an AAT training provider
- 48 Distance learning and other ways to study AAT
- 25 Apprenticeships
- 66 AAT membership