Adjustments (Task 1 & 2) Flashcards
1
Q
Closing inventory adjustment
A
DR Inventory (SFP)
CR Cost of Sales (SPL)
!!!For valuation - the lower cost or net realisable value
2
Q
Accrual adjustment
A
DR Expense (SPL)
CR Accruals (Trade and other payables SFP)
3
Q
Prepayment adjustment
A
DR Prepayments (Trade and other receivables SFP)
CR Expenses (SPL)
4
Q
Corporation tax adjustment
A
DR Tax expense (SPL)
CR Tax liability (SFP)
5
Q
Revaluation adjustment
A
DR PPE (SFP)
CR Revaluation surplus (SFP)
6
Q
Interest accrual adjustment
A
DR Finance costs (SPL)
CR Trade and other payables (SFP)
!!! May require the calculation of interest amount to accrue
