Study Roomhi all, resitting FR and keep messing up accruals in Q2. say we accrued £2,400 for electricity at year end, dr expense cr accruals. when the actual bill lands in the new year for £2,600, is the entry dr accruals £2,400 dr expense £200 cr bank £2,600, or do we reverse the original accrual first then post the invoice normally. ngl the QB answers seem to do both depending on the question and its bricking it for the exam.
accrual double entry when actual invoice differs
Asked by Tom H. · 1mo ago
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1 answer
Both are fine, the net effect is identical so don’t let QB wording spook you. If you reverse first: Dr accruals £2,400 Cr expense £2,400, then post the bill Dr expense £2,600 Cr bank £2,600, leaving £200 net expense. If you skip the reversal just do Dr accruals £2,400 Dr expense £200 Cr bank £2,600. In the exam I’d just post the net top-up and clear the accrual, it’s faster and you can see the £200 hits P&L. The only wrong answer is Dr expense £2,600 Cr bank £2,600 and leaving the £2,400 accrual sat there un-cleared.
Danny R. · 1mo ago
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