Accruals And Prepayments Flashcards
(12 cards)
An amount due in an accounting period which is unpaid at the end of an accounting period is called an A…… ?
Accrual
True or False
Accruals are added to the expense account shown in the trial balance before it is listed in the statement of profit or loss ?
True
Accrued expenses are shown as a (Asset/Liability) in the year end statement of financial position ?
Liability
(Prepayments/Accruals) are payments made in advance ?
Prepayments
In the extended trial balance and financial statements prepayments are (Deducted/Added) to the expense account shown in the trial balance before it is listed in the statement of profit or loss ?
Deducted
Prepaid expenses are shown as an (Asset/Liability) in the year end statement of financial position ?
Asset
True or False
Prepayments and accruals have to be dealt with manually and can not be done on an accounting system ?
False
accounting systems can automate the process
In the extended trial balance and financial statements accruals of income are (Deducted/Added) to the expense account shown in the trial balance before it is listed in the statement of profit or loss ?
Added
Accruals of income are shown as an (Asset/Liability) in the year end statement of financial position ?
Asset
In the extended trial balance and financial statements prepayments of income are (Deducted/Added) to the expense account shown in the trial balance before it is listed in the statement of profit or loss ?
Deducted
Accruals of income are shown as an (Asset/Liability) in the year end statement of financial position ?
Liability
When using a trial balance to produce final statements, private expenses should be (Added/Deducted) from the expense account and (Added/Deducted) from drawings ?
- Deducted
- Added
