Accounts Prep Exam! ETB

AngelDustAngelDust LondonPosts: 30Registered
Hi all,

I'm due to sit my exam soon and would like simple clarification on the following? I would ask my tutor but I find the response here is a lot faster!

1. Where on the ETB does the following go:

Irrecoverable Debt Account
Allowance for Bad Debt (Provision for Bad Debt)
Adjustment for Allowance of Bad Debt


^Always get confused with this ^

2. Please clarify if the following are debits or credits?

Accrued Income
Accrued expense

Prepaid Income
Prepaid Expense


^Again always get confused with this^


3. Journals. What are the journals required for the following:

On 1st Sep 2009 a delivery van which was fully depreciated and had cost £10,000 was scrapped. No proceeds were received.


Thanks in advance!

Comments

  • CeeJaySixCeeJaySix Well-Known Posts: 645Registered
    1. P&L
    2. SoFP
    3. P&L
    4. Debit - dr accrued income, cr sales/income. The income has been earned but not yet received, and is therefore a debtor.
    5. Credit - dr expense, cr accruals. The expense has been incurred but not yet paid.
    6 & 7 - reverse 4 & 5 (income has been received but relates to the next period, or expenses have been paid but relate to the next period).
    8. Dr motor vehicles accumulate depreciations, cr motor vehicles cost. This removes the asset from the accounts. As there was no profit or loss on disposal this is a straightforward entry (you received nothing, but it was worth nothing).
  • KkadijatKkadijat Posts: 28Registered
    1. Irrecoverable debt goes in SPL Dr
    2. Allowance for DD SFP cr
    3. Allowance for DD ADJ' SPL, this could be a Dr or a Cr

    For instance if the allowance for previous year was £1000 and the business increase it by £300 in the next year and is treated as a loss to the business so Dr in SPL. But if the business reduce it by £300, this means a profit to the business and is Cr in SPL.

    ACCRUED INCOME is recorded in SFP as an ASSET this means it will be a Dr
    ACCRUED EXPENSES is recorded in SFP as a LIABILITY ie a Cr
    PREPAID INCOME is recorded in SFP as a LIABILITY which means a Cr
    PREPAID EXPENSES is recorded as an ASSET in SFP meaning a Dr
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