Journal entry
Querist : Anonymous
Prepaid Rent A/C DR
To Bank
(exp paid in advance)
Rent Exp A/C DR
To Prepaid Rent A/C
The net effect of entry is
Rent Exp A/C DR
To Bank
but the correct entry is
Prepaid Rent A/C DR
To Rent A/c
how, can any one explain when we paid exp in advance then bank account should be use as above i mention. please explain the step wise because first we paid exp in advance and then in future we received invoices shoe both the event/transaction.
Thanks
Sanjeev Kumar
Guest
Prepaid Rent A/C DR
To Bank
(exp paid in advance).
or
Rent Exp A/C DR
To Bank
------
Prepaid Rent A/C DR
To Rent A/c
Querist : Anonymous
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