Prior period expenses

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

14 September 2012 The bill date is 19/03/2012 for the internet charges and the period for which the bill was received is from 01/05/2012 to 31/07/2012.whether such expenses to be recorded in Internet expenses account or should get debited under prior period expenses account.?

Amol S Joglekar

Amol S Joglekar (Expert)
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14 September 2012 Prior period OR FUTURE period? It is the normal practice of the internet companies to give the bill in advance. The company needs to decide once and for all how to account for the same. The consistancy principle be followed. The common practice for the BPOs is to treat this as advance bill. (Relating to future period)not for 2011-12

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