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At 1 January 2005, Michael had a prepayment of 200$ in respect of rent. He paid 1200$ on 1 March 2005 in respect of the year ended 28 February 2006.
what is the charge to the income statement in respect of rent for the year ended 31 December 2005?also I can’t understand above they said that year is ending in February. But in the question it is ending in December.
can somebody write the solution in details?If the year is ending in December as is said in question than there will be 10 month.
The answers are (I forgot to post them) :
A 1400 $
b 1200 $
c 1100 $
d 1300$answer is 1200…
rent is being paid for 12 months ..
see prepayments for jan and feb.. then 10 months from march to dec..
in last 200 will be in prepayments..
🙂so then 200$ prepayments from 2004 year are for the January and February (2005) 😀
it’s a bit confusingIts confusing for me too. Check your question again and post it full here at ONCE
At 1 January 2005, Michael had a prepayment of 200$ in respect of rent. He paid 1200$ on 1 March 2005 in respect of the year ended 28 February 2006.
what is the charge to the income statement in respect of rent for the year ended 31 December 2005?The answers are:
A 1400 $
b 1200 $
c 1100 $
d 1300$
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