Help on fixed asset accrual

Sam1919

Hi I'm hoping someone can help.......If there is a fixed asset that is in use but an invoice has not yet been received at the year end I am assuming an accrual is needed? However seen as the journal entries Dr Fixed asset additions and CR Accruals are both balance sheet items it is confusing me whether this is correct!?
Thanks

Marco

Hi Sam
I am assuming that you are right,
Dr Assets
Cr Accruals

Sam1919

Thank you. I'm now on the following year so as expected auto reversal is Dr accruals and Cr assets but my TB is £1,000 out and I thought it could be relating to the £500 which was the cost of the asset mentioned above!? Maybe I'm looking in the wrong area!?

Marco

No you should Dr Accruals and Cr the Bank because you are paying for the asset from your bank

Marco

this would be adjustment

Marco

if your TB doesn't balance its maybe you put them account in same side thats why its doubled

Sam1919

Oh right I thought it would be
Dr accruals
Cr assets
then
Dr assets
Cr bank
But I guess that has the same end result as your postings anyway!?

I'm still £1,000 out on the Cr side either way......

Marco

Can you send me the whole question and ur TB please so i can have a look
marco_m529@hotmail.co.uk

MarieNoelle

Just a thought...you say you haven't received an invoice yet but has the asset been paid for already? in which case the proper entry would be Dr Supplier Cr Bank. Then on receipt on the invoice you would enter Dr asset Cr Supplier.

Sam1919

I will do later i haven't actually got it on me right now it's just something that's bugging me.
Many thanks

Sam1919

MarieNoelle at the end of the first accounting year the asset had not been paid for. I'm now working on the next year's accounts so it has now been paid for.
Thanks for your comment.

MarieNoelle

Then I would do Dr Asset Cr Supplier and when you pay Dr Supplier Cr Bank. No accrual needed?

Marco

Yeah I would say the same. Marie is right

Sam1919

Thanks guys and girls great help