Prepayment

1 Jan pay Feb Insurance $3000 by cheque in advance

What account should be involved? prepayment(debit/credit)Do i need to credit the fee during next month(Feb), bank (debit/credit),insurance(debit/credit)

2 個解答

評分
  • 1 十年前
    最愛解答

    Jan -

    Dr Prepaid insurance $3000

    Cr Bank $3000

    Feb - Adjustment

    Dr Insurance $3000

    Cr Prepaid insurance $3000

    Expense always increase on debit side

  • ?
    Lv 5
    1 十年前

    January entries

    Debit Bank Account/Cash

    Credit Pre-paid Expenses

    February entries

    Debit Pre-paid Expenses

    Credit Insurance Expenses

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