Pre payment

This query is : Resolved

Gurvinder Singh (Querist)
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27 May 2014 Pls adv, if we make telephone payments for a lumpsum amount for subsequent months in advance, which entries should be passed. Pls explain the ledger name to be debited under which main tally head. Also, how will the entries be written off in the subsequent months. Pls explain dr and cr with example.

Thnx and regards
Gurvinder Singh

Nikhil Kaushik

Nikhil Kaushik (Expert)
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27 May 2014 at the time of payment:

Prepaid Telephone Charges A/c

To Bank A/c

at each bill due date:

Telephone Charges A/c

To Prepaid Telephone Charges A/c

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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28 May 2014 if at the year end any bal in prepaid telephone charges lying then disclose it in balance sheet under current assets under other current assets.

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