Pre-€STR and Prepaid expense: Difference between pages
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'' | ''Financial reporting''. | ||
An amount paid in advance for a financial benefit, represented by an asset in the organisation's balance sheet. | |||
<span style="color:#4B0082">'''''Example: Venue hire'''''</span> | |||
We book a venue for a function. | |||
And pay 50% of the hire fee in advance. | |||
The 50% paid in advance is an ASSET for us. | |||
We are going to enjoy the use of the venue in future, but it has already been paid for. | |||
== | So the 50% already paid represents a future economic benefit. | ||
* [ | |||
Also known as a ''prepayment''. | |||
== See also == | |||
* [[Accrual]] | |||
* [[Accrued expense]] | |||
* [[Accrued income]] | |||
* [[Bookkeeping]] | |||
* [[Capitalisation]] | |||
* [[Deferred income]] | |||
* [[Expenditure]] | |||
* [[Expense]] | |||
* [[Prepayment]] | |||
* [[Prepayments]] | |||
[[Category:Accounting,_tax_and_regulation]] | [[Category:Accounting,_tax_and_regulation]] | ||
[[Category:The_business_context]] | [[Category:The_business_context]] | ||
Latest revision as of 22:19, 14 July 2022
Financial reporting.
An amount paid in advance for a financial benefit, represented by an asset in the organisation's balance sheet.
Example: Venue hire
We book a venue for a function.
And pay 50% of the hire fee in advance.
The 50% paid in advance is an ASSET for us.
We are going to enjoy the use of the venue in future, but it has already been paid for.
So the 50% already paid represents a future economic benefit.
Also known as a prepayment.
