Receipts in advance

CMA Vamshi Raghavendra (Student) (192 Points)

22 August 2012

Sir,

We are dealing with Audit of School

We have school fees received in advance Last year - We reflected it at LIABILITY SIDE of B/S.

What is the treatment for current year ???

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4 Replies

CA. Subhash Dangi (Chartered Accountant) (1784 Points)
Replied 22 August 2012

U pass an entry to recognise the revenue in current year

Entry:

Liability A/c Dr.... xxxx

To School fees A/c xxxx

(Being advance receipt of scholl fee received last year broght to revenue account)

CMA Vamshi Raghavendra (Student) (192 Points)
Replied 22 August 2012

Sir,

I got it.... So it should be reduced in liablities side and should be treated as current years income .......

Thank u sir...

Bhaskar Unnikrishnan CPA CMA (Accounts / Administration) (414 Points)
Replied 23 August 2012

Prev year Journal entry: (Debit) Cash a/c (Cr.) Deffered Income (Liability) CY: (Debit.) Deffered Income (Liability) (Cr.) School Fees

CMA Vamshi Raghavendra (Student) (192 Points)
Replied 23 August 2012

Exactly sir,,,,, i agree with u

thank u

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