Prepayments & Accruals

[JAB]

I know these should be simple but i can never get the postings correct.<BR><BR>I've know problem working out the figures but can never remember where to put the entries in the ETB, P/L or B/S, can anyone try and explain to me how to remember.<BR>

[Steph]

Accruals are liabilities because it is money you owe, therefore is a credit balance. It is entered on the debit side on the etb to increase the sum carried over to the p+l, the balance sheet will show the corresponding entry as a credit.<BR>Prepayments are assets to the business so are a debit balance. they are a credit entry in the etb to reduce the sum carried over to the p+l. They are shown as a debit on the balance sheet.<BR>Hope this helps, I know they're a pain!!<BR>Steph<BR>:)