cost of sales, accruals and prepayments Flashcards
1
Q
what is the double entry for an accrual
A
DR expense (SPL)
CR accrual (SFP)
2
Q
what is the double entry for a prepayment
A
DR prepayment (SFP)
CR expense (SPL)
3
Q
where is accruals in the financial statement and under what heading
A
- Statement of financial position
- Current liabilities (other payables)
4
Q
where is prepayments in the financial statement and under what heading
A
- Statement of financial position
- Current assets (other receivables)
5
Q
double entry for reversing opening accrual
A
DR accrual
CR expense
6
Q
double entry for reversing opening prepayment
A
DR expense
CR prepayment
7
Q
what is deferred income?
A
- income that is received but not yet earned
- relates to the future
- liability to us
8
Q
what is the double entry for deferred income?
A
- DR income
- CR deferred income
9
Q
what is accrued income?
A
- income that is earned but not yet received
- needs to be included in profit and loss
- recognised as an asset
10
Q
what is the double entry for accrued income?
A
DR accrued income
CR income
