I have an invoice for 12 months rent which I have paid, where 9 months of rent falls into one accounting period, and 3 into the next.
I’m wondering what the best way to handle this is in Quickfile?
The approach I’ve considered using is to tag the bank payment with “Pay down multiple invoices” to assign a credit to the supplier, then create multiple ‘virtual’ purchases, dated to fall in the correct accounting periods, paid out of that credit. However I’m not sure if this will cause confusion with handling receipts.
Any advice on whether this is an appropriate way to deal with this kind of situation, or any better alterntives appreciated!
Simplest is to make a purchase for the full amount and then make the correction with an auto-reversing journal at year end - make a journal on the last day of the accounting year that does credit rent and debit prepayments for the three month amount, and make it auto reverse on the first day of the next year. This should move three months worth of rent from this year’s P&L onto the year end balance sheet, then back to P&L next year.
You might have to create a suitable nominal in assets & liabilities if you don’t already have one for prepayments - I’m not sure what gets created by default and what doesn’t these days.