Australia Accounting for future invoice


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Hello All ,

I've received a rent invoice for next month .How do I record it under accrual concept . We don't pay it until next month .

Thank you
 
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kirby

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Assume your rent begins 10/1/19 and you receive the invoice for that on 9/15/19. No accrual entry is needed in Sept because your liability begins 10/1/19.
As a practical matter, you need to issue payment in Sept so it arrives on time on or near 10/1/19. So you would issue payment in Sept for Oct rent as:
DR Prepaid Rent
CR Cash
Then on 10/1/19 make the entry
DR Rent Expense
CR Prepaid rent
Also, if you had any periods of free or discounted rent in your agreement, let us know because more accounting is required to handle that.
 

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