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Help on accruals please

This topic has 2 replies, 3 voices, and was last updated 12 years ago by Anonymous.

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March 16, 2012 at 11:11 am #51880
gyanmichael
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Please can someone explain(detailed) this question to me.
Details of Bartlett’s insurance policy are as below:
Premium for year ended 31 March 20X6 paid April 20X5 $10800
Premium for year ended 31 March 20X7 paid April 20X6 $12000
What figures should be included in the company’s financial statements for the year ended 30 June 20X6?
Income statement? Balance sheet?
March 17, 2012 at 11:08 am #95547
Sangria9
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@gyanmichael
Financial year is 1 July 20X5 – 30 June 20X6
In the income statement next insuarance expenses should appear: $11100
1 July 20X5 – 31 March 20X6: 9/12 * $10800 = $8100
1 April 20X6 – 30 June 20×6: 3/12 * $12000 = $3000
In the balance sheet you will have $9000 prepayment for next financial year ($12000 – $3000)
March 18, 2012 at 3:40 am #95548
Anonymous
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I agree with Sangria9 because after doing my calculation, i got d same answer.
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