Accounting treatment of prepaid expense & outstading exp

hi Ajay,

Accounting treatment of Prepaid Expenses

1. At the time of expenses

        Expenses Account - Debit  ------------Profit and Loss acccount item

           Cash/Bank/Vendor Account Credit

2. At the of Books Closing

        Prepaid Expenes A/c - Debit  ---------------- Balance Sheet item

            Expenses Account Credit  ------------------ Profit and Loss account item

Accounting Treatment for Outstanding Expenses

1. At the of Books Closing

          Expenses Account Debit ----------------Profit and Loss Account item

             Outstanding Expenses Credit ------------Balance Sheet Item

2. At the time actual expenses incurring

          Outstanding expenses account Debit ------------Balance Sheet Item

             Cash/Bank/Vendor Account Credit

With regards,

CMA.Baskar.V

sir,

i just want to know the accounting treatment for outstanding expenses when its paid to parties at the time of closing books of accounts ie. the expeses should been shown both in parties ledger as same time in related expenses & in outstanding exps