0
If you are the payer
Increase in Prepaid Expenditure- Asset
Decrease in Bank - Asset
Equity= Asset- Liabilities
0 = +/- - 0
If you are the payee
Increase in Income Recieved in Advance - Liability
Increase in Bank - Asset
Equity= Asset- Liabilities
0 = + - +
Wiki User
∙ 11y ago
Add your answer:
Earn +20 pts
What is the difference between prepaid expense and advance payment?
Prepaid expense is a payment which relevant to services which expected to delivered in the next accounting period, while advance expense is an expense paid in advance for services expected to delivered in the current accounting period.
What is an expanded basic accounting equation?
The expanded accounting equation replaces Owner's Equityin the basic accounting equation (Assets = Liabilities + Owner's Equity) with the following components: Owner's Capital + Revenues - Expenses - Owner's Draws. In other words, the expanded accounting equation for a sole proprietorship is: Assets = Liabilities + Owner's Capital + Revenues - Expenses - Owner's Draws.In the expanded accounting equation for a corporation, Stockholders' Equity in the basic accounting equation (Assets = Liabilities + Stockholders' Equity) is replaced by these components: Paid-in Capital + Revenues - Expenses - Dividends - Treasury Stock. The resulting expanded accounting equation for a corporation is: Assets = Liabilities + Paid-in Capital + Revenues - Expenses - Dividends - Treasury Stock.The expanded accounting equation allows you to see separately (1) the impact on equity from net income (increased by revenues, decreased by expenses), and (2) the effect of transactions with owners (draws, dividends, sale or purchase of ownership interest).
How does receiving a bill to be paid next month for services rendered affect the accounting equation?
assets increase; liabilities increase
A business paid 9000 to a creditor in payment of an amount owed The effect of the transaction on the accounting equation was to?
increase an asset, increase a liability
A business paid 7000 to a creditor in payment of an amount owed. The effect of the transaction on the accounting equation was to?
decrease in asset and decrease in liability
What is the difference between prepaid expense and advance payment?
Prepaid expense is a payment which relevant to services which expected to delivered in the next accounting period, while advance expense is an expense paid in advance for services expected to delivered in the current accounting period.
What is the accounting equation for paid cash dividends to owners?
DR Dividends $xx.xx CR Cash $xx.xx
What is an expanded basic accounting equation?
The expanded accounting equation replaces Owner's Equityin the basic accounting equation (Assets = Liabilities + Owner's Equity) with the following components: Owner's Capital + Revenues - Expenses - Owner's Draws. In other words, the expanded accounting equation for a sole proprietorship is: Assets = Liabilities + Owner's Capital + Revenues - Expenses - Owner's Draws.In the expanded accounting equation for a corporation, Stockholders' Equity in the basic accounting equation (Assets = Liabilities + Stockholders' Equity) is replaced by these components: Paid-in Capital + Revenues - Expenses - Dividends - Treasury Stock. The resulting expanded accounting equation for a corporation is: Assets = Liabilities + Paid-in Capital + Revenues - Expenses - Dividends - Treasury Stock.The expanded accounting equation allows you to see separately (1) the impact on equity from net income (increased by revenues, decreased by expenses), and (2) the effect of transactions with owners (draws, dividends, sale or purchase of ownership interest).
How does receiving a bill to be paid next month for services rendered affect the accounting equation?
assets increase; liabilities increase
A business paid 7000 to a creditor in payment of an amount owed. The effect of the transaction on the accounting equation was to?
decrease in asset and decrease in liability
A business paid 9000 to a creditor in payment of an amount owed The effect of the transaction on the accounting equation was to?
increase an asset, increase a liability
Are Advance paid a current asset or current liability?
advance paid is current asset and advance received is current liability.
Can lawyers get paid in advance?
Yes they do get paid.
Rent paid in advance?
Yes, what about rent in advance?
Salary paid in advance is not an expense because it neither reduces assets nor increase liabilites?
True: Salary paid in advance relates to the coming accounting period. It has nothing to do with the current period. Hence it is not taken in the Profit and Loss Account as an expense. It is shown as a Current Asset in the Balance Sheet.
What is the journal entery for salary paid advance to mr A?
debit salary paid in advance creidit mr.a a/c
Insurance premium paid in advance Is it a accrued expenses?
No, if Insurance premium is paid in advance then it is a Prepayment - current asset.
