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Insurance prepaid
insurance period is 31-may-22 to 30-may-23, paid insurance charges of rs. 2,16,024, pls explain how to pass prepaid entry
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What is period ?. 31/5/23 to 30/5/2024 or given as above .
Sorry I paid total insurance charges of rs 216024 for the period of 31st may 22 to 30th may 23 how much is prepaid amount and how to pass entry
How 31/5/2022 to 30/5/2023 ? , this period is over .
Divide the amount with 12 and pass the entry for Prepaid account (April-23 & May-23) as below
Dr. Prepaid Insurance A/c - Rs.36004/-
CR. Insurance (?) A/c - Rs.36004/-.
Dr. Prepaid Insurance A/c - Rs.36004/-
CR. Insurance (?) A/c - Rs.36004/-.
Advance payment entry on 31/5/22
Prepaid Insurance Charges A/c Dr 216024 /-
To Bank. A/c Cr 216024/-
( prepaid Insurance Charges)
Prepaid Insurance charges A/c under Current Asset
April 23 entry
Insurance charges A/c Dr. 18002 /-
To Prepaid Insurance Charges Ac Cr 18002/-
May 23 entry
Insurance charges A/c Dr. 18002 /-
To prepaid Insurance Charges A/c Cr 18002 /-
Similarly you have to pass all adjustment entries as above in last F.Y from 31 May to 31st March.
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