7. Accounting for accruals and prepayments Flashcards
1
Q
Accrued expenses
A
DR expense account SPL (reduction in profit)
CR accrual account SFP (current liability)
2
Q
Prepaid expenses
A
DR prepayment account SFP (current asset)
CR expense account SPL (increase in profit)
3
Q
Accrued income
A
DR accrued income SFP (current asset)
CR sales revenue SPL (increase in profit)
4
Q
Prepaid income
A
DR sales revenue SPL (reduction in profit)
CR prepaid income SFP (current liability)
