I’m unsure how I should enter details of future committed charges occurring in the next FY which have been paid for in the current FY. Clearly if I simply left entering them until next year I’d have an issue with a “false” profit arising this year and then a “false” loss next. Can anyone guide me where I need to go to enter these details? Thanks
Hello @davidmonks
Can I ask What vat scheme you are on?
Cash accounting - the tax point is the point at which payment is made.
Standard/Accural Accounting - the tax point it the date at which the invoice is raised.
Steve,
We’re using Standard accounting if that helps.
David
Hello @davidmonks
A journal would be used to move the value to your balance sheet until the correct period.
Accrued expenses are recognized by debiting the appropriate expense account and crediting an accrued liability account. A second journal entry must then be prepared in the following period to reverse the entry.
Thanks Steve - very helpful.
David
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