Canada What is account credit balance, in terms of Accounting?

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I'm writing a financial statement for my accounting course, and one of the transactions I saw is: July 5th: "Go Daddy shows july Computing cost to be $150 dollars, and Company A (The Company in question) has a account credit balance of $100".

Does this mean $150 Dollars are considered an expense, and $100 are also an expense? (Both to be shown in the expense section for financial statements? I'm confused with the wording.

Any help would be much appreciated.
 
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"You" are company "Go Daddy" and Company A is the vendor / provider for those computing costs?

so the first recording is "computing-costs $150--> accounts payables (Company A) $150"

now the account payables account of "Company A" should show a total of $150 in favour to Company A

If the task/exercise says "there is now, after the recording a total credit balance of only $100" in favor to company A there must be a previous recording (perhaps a creditnote) or a prepayment?

Or did i understood totally wrong?
 
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"You" are company "Go Daddy" and Company A is the vendor / provider for those computing costs?

so the first recording is "computing-costs $150--> accounts payables (Company A) $150"

now the account payables account of "Company A" should show a total of $150 in favour to Company A

If the task/exercise says "there is now, after the recording a total credit balance of only $100" in favor to company A there must be a previous recording (perhaps a creditnote) or a prepayment?

Or did i understood totally wrong?
I'm Company A, Go Daddy is the company we are paying for Computing Costs.
And COmpany A (Myself) payed go Daddy a $400 deposit cost, earlier in the month (I believe that is an expense).
 
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I'd say that those $400 deposit cost are only "real costs" if you have got an invoice, otherwise I'd classify as prepayment.
record for prepayment (your above mentioned $400 deposit costs) might have been
Go-Daddy (acc.pay.) $400
--> bank/cash $400

=> account payables (Go-Daddy) +$400
Such an account credit balance shows $400 in favor to A-Company, as there is no invoice.

If an invoice from Go-Daddy for some computing stuff arrives, it would have been recorded
computing-cost $150
--> Go-Daddy (acc.pay) $150

=> account payables (Go-Daddy) +$250
 
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I'd say that those $400 deposit cost are only "real costs" if you have got an invoice, otherwise I'd classify as prepayment.
record for prepayment (your above mentioned $400 deposit costs) might have been
Go-Daddy (acc.pay.) $400
--> bank/cash $400

=> account payables (Go-Daddy) +$400
Such an account credit balance shows $400 in favor to A-Company, as there is no invoice.

If an invoice from Go-Daddy for some computing stuff arrives, it would have been recorded
computing-cost $150
--> Go-Daddy (acc.pay) $150

=> account payables (Go-Daddy) +$250
Hmm, interesting so they're both accounts payable, and don't show up as expenses in the Income statement? But rather as accounts payables in the Financial Position Statement.
 
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Hmm, interesting so they're both accounts payable, and don't show up as expenses in the Income statement? But rather as accounts payables in the Financial Position Statement.
No.

the second one is shown as expenses in the Income Statement (those $150 computing costs)


with the prepayment $400 Go-Daddy owes you.... goods or services -> and has to invoice them...
if Go-Daddy does nothing and they refund you those $400 back the account is cleared / balanced.

now Go-Daddy works for $150 and invoices that stuff; instead of paying those $150 you both can charge it against the prepayment / cost deposit

=> account Go-Daddy
+400 (in favor to A-Company)
-150 (invoiced stuff)
===> 250 (in favor to A-Company)
 

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