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ACCRUALS AND PREPAYMENTS
Wha
217 Leisure Co owns two properties which it rents to tenants. In the year ended 31 December 20X6, it received $280,000 in respect of property 1 and $160,000 in respect of property 2. Balances on the prepaid and accrued income accounts were as follows:
31 Ja
A
B
C
31 December 20X6
31 December 20X5
Property 1
13,400 Dr
12,300 Cr
Property 2
6,700 Cr
5,400 Dr
What amount should be credited to the statement of profit or loss for the year ended 31 December 20X6 in respect of rental income?
How to deal with Dr and cr over here I am confused and not able to find the answer through solution
Because they are receiving rent the cash received will be credited to the rental income accounts.
The opening and closing balances are as given in the question, and the ‘missing figures’ in the accounts will be the income for the year which appears in the SOPL.
For accrual and prepayment I have completed all the questions in the kit, but I am not able to understand this question. Can you please explain this question that why we are adding 12300 and 13400 and subtracting 6700 and 5400
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