TOPIC 1 pt.1 Flashcards
(8 cards)
Entry for purchases made, invoice not received
D
Purchases (6xx)
C
Trade payables, invoice pending
When I receive the invoice:
D
Trade payables, invoice pending
C
Trade payables
Entry for purchases made, but goods not received
D
Purchases
C
Trade payables
When I receive the goods:
D
Inventories
C
Change in Inventories
Entry for return of purchases/sales made in previous years
Purchases:
D
Trade Payables
C
Retained Earnings
Sales:
D
Retained Earnings
C
Trade Recievables
Explenation: We use retained earnings because these are purchases and sales from last year. Retained earnings are profit and losses from previous years. We always use it when we talk about previous years.
Entry for monthly final inventory adjustments
D
Changes in Inventory
C
Initial Inventory
(I cancel my initial inventory)
D
Final Inventory
C
Changes in Inventory
Entry for when I receive money at the beginning
D
Cash in Banks (The whole quantity)
C
Deferred Income (The rest that I will be payed)
Income from rentals (What I receive this month)
D
Deferred Income
C
Income from Rentals (Monthly amount, I record this every month)
Entry for when I receive the money at the end
D
Debtors
C
Income from Rentals (Monthly amount, repeat monthly)
At the end:
D
Cash in Banks (Full amount)
C
Debtors (What you have accumulated)
Income from rentals (Monthly amount)
Entry for prepaid expenses, year in advance
D
Insurance Premium (Or any other type of expense, such as Rent) (1/12 of what u have to pay)
Prepaid Expenses (11/12)
C
Cash in Banks (Full amount)
Then every month:
D
Insurance Premium
C
Prepaid Expenses
Entry for payent after consumption, year end
Every month we account:
D
Utilities (Monthly consumption)
C
Creditor for services rendered, invoice pending
When I receive the invoice:
D
Creditor for services Rendered, invoice pending
C
Creditor for services Rendered
D
Creditor for services rendered
C
Cash in Banks
