| Equity Issues and discussions related to accounting for expenses, revenues and other areas that relate to owner's or stockholders equity. |
![]() |
|
|
LinkBack | Thread Tools | Display Modes |
|
|
#1 (permalink) |
|
Status: n00b
Join Date: Jun 2008
Posts: 3
![]() |
Please help with the following problem!
"You are in the process of doing month-end close, and you just received a phone bill (which arrived late) which refers to the accounting period that is being closed. Is any adjusting entry needed?" Thank you for any help. |
|
|
|
|
|
|
|
|
|
|
|
#2 (permalink) |
|
Status: Owner/Administrator
Join Date: Mar 2008
Location: Berkeley, CA
Posts: 160
![]() |
The questionis, did you already accrue the expense in the first place?
For accruing an expense like a phone bill... the following should be done... Before receiving the phone bill: Dr. Phone Expense Cr. Accounts payable After the bill arrives: Dr. Accounts payable Cr. Cash
__________________
Zahid H. Lilani |
|
|
|
|
|
#3 (permalink) |
|
Status: n00b
Join Date: Jun 2008
Posts: 3
![]() |
Why do i need to credit cash, if i haven't actually paid the bill yet?
|
|
|
|
|
|
#4 (permalink) |
|
Status: Owner/Administrator
Join Date: Mar 2008
Location: Berkeley, CA
Posts: 160
![]() |
I mention above that After the bill arrives you
Dr. Accounts payable Cr. Cash I assumed that once you get the bill you will pay it... was I wrong?
__________________
Zahid H. Lilani |
|
|
|
|
|
|
|
|
|
![]() |
| Bookmarks |
| Currently Active Users Viewing This Thread: 1 (0 members and 1 guests) | |
| Thread Tools | |
| Display Modes | |
|
|