Hi Sir/Madam
Can I make prior period entry in Proprietor accounts also
I have seen few Capex items are expensed in previous financial year
It's a proprietor entity
Can I make prior period entry in current financial year
Please advise
Thanks in advance
If AS 5 ( Accounting standard) is applicable and permits, then you Can make prior period expenses entry in the Current period, You have to show separately in Profit and Loss account ( Check AS5)
Entries as follows.
prior period expenses A/c Dr
To Cash / Bank A/c Cr
( Last year expenses)
Profit and Loss A/c Dr
To Prior period expenses A/c Cr
( Transfer entry to P&,L A/c )
Such type of expenses you may not get deduction under Income tax Act .
CAclubindia
