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The elecetricity account for the year ended 30 April 2005 was as follows:
Electricity accrued at 1 May 2004 : $250
Payments made during the year
Quater ending 30 June 2004: $400
Quater ending 30 Sep 2004: $350
Quater ending 31 Dec 2004:$425
Quater ending 31 Mar 2005:$450Accrued at 30 Apr 2005?
Electricity charge to S.O.P.L for year end 30 Apr 2005?** Hi John, would you help me with this question? I think this question isn’t giving me enough information to get the answer.
The answer is 150 accrual and 1525 charge on S.O.P.L, but how can I get the April’s expense??Thanks in advance,
In this situation we have no choice but to look at the last charge and assume that the rate will stay the same for the accrual.
So since the cost of 3 months to 31 March was $450, that was $150 per month. We therefore assume that April will also be $150 per month.Obviously this is only an approximation and in real life this might not be the case, but as I explain in my free lectures it is usually only an estimate in real life anyway 🙂
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