Life of the expense
A prepaid expense is an asset listed on the balance sheet.
A prepaid expense account is an asset, thus not a temporary account either.
If legal expense paid in advance of rendering services then it is prepaid expense otherwise not. Also this company provides all the necesary steps. tarifcheck365.com
it will either increase or decrease profit. Prepaid expense should increase profit as the amount has been overstated.
There isn't much of a difference between a prepaid expense and a deposit. Both terms are monies that are paid in advance to pay for something. With a prepaid expense, the money pays usually for a bill or utility. A deposit on the other hand, is sometimes given back after the obligation is paid. If it is not paid, the deposit is kept as payment.
Life of the expense
[Debit] Prepaid Expense xxxxx [Credit] cash / bank xxxxx
A prepaid expense is an asset listed on the balance sheet.
A prepaid expense account is an asset, thus not a temporary account either.
A prepaid expense account is an asset, thus not a temporary account either.
A prepaid expense account is an asset, thus not a temporary account either.
it is because,we just doing a early payment for the future expense
If legal expense paid in advance of rendering services then it is prepaid expense otherwise not. Also this company provides all the necesary steps. tarifcheck365.com
Prepaid expense is that amount of expense which is paid in advance and expense is not actually incurred and prepaid expense is current assets of business and show under assets side of balances heet.
it will either increase or decrease profit. Prepaid expense should increase profit as the amount has been overstated.
Asset