Hi, I made up the example below & found it tricky to solve.
How to deal with this? Thank you very much.
Year end: 31/12/20x1
Order of $1000 placed at 31/10/20x1, with deposit of 20% paid
Goods received at 31/12/20x1
Invoice received at 02/01/20x2
Invoice paid at 31/02/20x2
At 31/10/20x1, order placed & deposit paid:
Dr purchase ledger $200 (prepayment)
Cr cash $200
At 31/12/20x1, goods received:
Dr purchase $1000
Cr purchase reserve $800 (Is $800 right? as we have paid $200. Then the year end cuts in, but the entries don't balance, how to deal with it?
year end
At 02/01/20x2, invoice received
Dr purchase reserve $800
Cr purchase ledger $1000
At 31/02/20x2, payment fully made.
Dr purchase ledger $800
Cr cash $800
How to deal with this? Thank you very much.
Year end: 31/12/20x1
Order of $1000 placed at 31/10/20x1, with deposit of 20% paid
Goods received at 31/12/20x1
Invoice received at 02/01/20x2
Invoice paid at 31/02/20x2
At 31/10/20x1, order placed & deposit paid:
Dr purchase ledger $200 (prepayment)
Cr cash $200
At 31/12/20x1, goods received:
Dr purchase $1000
Cr purchase reserve $800 (Is $800 right? as we have paid $200. Then the year end cuts in, but the entries don't balance, how to deal with it?
year end
At 02/01/20x2, invoice received
Dr purchase reserve $800
Cr purchase ledger $1000
At 31/02/20x2, payment fully made.
Dr purchase ledger $800
Cr cash $800
