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If Financial year of company ends 30 June 20X1 and
In payments made during the year1 August 20X0 for three months to 31 July 20X0 is 600$
?s This charge included in SOPL year ended 30 June 20X1??
This practice test belongs to BPP F3 REV?S?ON&K?T 2016-2017
Page 49,question 10.7I can not understand why 600$ is completely included in SOPL(for year ended 30 June 20X1)
Please ,explain to meIt isn’t completely included.
The charge for the year is the total cash paid less what was accrued at the start of the year plus what needs accruing at the end of the year.
The accrual at the end of last year turns out to be wrong – they should have accrued 2/3 x 600 = 400 (for the 2 months to 30 June X0 – but we can’t go back and change last year. Effectively it is corrected this year.
I do explain this in my free lectures on accruals and prepayments.
in that case.
l understand so:opening balance for the electricity accrued at 1July 20X0 is given $300
but we compute that opening balance(1 JULY 20X0) is 400$(600×2/3)in the such situation ,we should take 300$ because we can not change accrual of the end of last year …
exactly??
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