Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Accrued revenue???
- This topic has 1 reply, 2 voices, and was last updated 6 years ago by MikeLittle.
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- April 12, 2018 at 5:30 am #446269AnonymousInactive
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If I sell goods( asset) which I have not yet billed to customer but have completed the deliveries and the revenue associated to that goods are due in arrear , why is this held in the balance sheet and not the income statement as it is Revenue earned thought not yet billed ?
How do I represent this accrued income on the balance sheets and by what name ?April 12, 2018 at 7:41 am #446294Just because you haven’t got round to invoicing for those goods does not remove the fact that your customer is a receivable in your records
How would you record the revenue generated by that sale?
If you are recording the revenue / sale before the year end then Dr ???? Cr Revenue
And if you’re going to record the revenue / sale after the year end (and ownership of the goods has passed so it’s no longer your inventory) then your entry will need to be Dr Receivable Cr Deferred Revenue
But the bigger question is … why on Earth are you delivering and not invoicing? Even though there is a period of credit (even extended credit) involved, the invoice should still have been raised
This looks to me like a hypothetical situation that you have dreamed up (?) and it must be an extremely rare situation in real life
OK?
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