thank you so much for taking the time to record and post. I was really struggling to understand when the Prepayment Expense is a debit, why it showed on the Credit side of the expense account and then showed back on the debit side in the new year. Accruals was confusing too! But now I can carry on studying, knowing how it all works. Thanks again and please don't stop posting, its brilliant! kindest regards Annette - Self Studying
It was a mistake, you're right. Dr in ledger, Cr in adjustments and when you subtract these DR and Cr balances you will find right answer, which is Dr (assets) in SFP.