Why Are Prepaid Expenses An Asset

Income Taxes - New York University
Tax journal entries Originating vs reversing differences Asset, Liability income. 2 types: non-taxable revenues non-deductible expenses (ex. GW amortization) ex. E13-7 Exhibit 13.2 prepaid expense Books = accrual accounting Taxes = cash accounting DR ... Retrieve Content

Accounting Journal Entries - What Are Journal Entries And How ...
If the account is on the Asset or left side, that is the Debit side. A debit will increase those accounts and a credit will decrease them. If the account is on the Liabilities and Owner's Equity or right side, that is the Credit side. ... Read Article

Accounting Principles, 5e - Wiley: Home
The adjusting entry results in a debit to an expense account and a credit to an asset account. Examples of prepaid expenses include supplies, insurance, and depreciation. October 31, an inventory count reveals that $1,000 of $2,500 of supplies are still on hand. ... Get Doc

ACC 291 Final Exam (University Of Phoenix) - YouTube
The book value of an asset is equal to the 6) Gains on an exchange of plant assets that has commercial substance are 7) There has been an increase in prepaid expenses of $16,000 during the year, and accrued liabilities are $24,000 lower than in the prior period. ... View Video

American Pacific Reports Strong Financial Performance For Fiscal 2012
LAS VEGAS, Dec. 13, 2012 /PRNewswire/ -- American Pacific Corporation (NASDAQ: APFC) today reported financial results for its fiscal year and fourth quarter ended September 30, 2012.We provide non-GAAP ... Read News

Sales And Purchase Returns
BDA # 1: Prepaid Expenses. In Unit 3 Accounting, when an expense is paid for in advance, it is identified as a . prepaid expense Why depreciate? Because the asset contributes to revenue, ... Fetch Content

Chapter 3 - Wiley
The adjusting entry results in a debit to an expense account and a credit to an asset account. Examples of prepaid expenses include supplies, insurance, and depreciation. October 31, an inventory count reveals that $1,000 of $2,500 of supplies arestill on hand. ... Get Document

Asset - Wikipedia, The Free Encyclopedia
Prepaid expenses — these are expenses paid in cash and recorded as assets before they are used or consumed (a common example is insurance). See also adjusting entries. Marketable securities Securities that can be converted into cash quickly at a reasonable price. ... Read Article

Chapter 4: Accrual Basis Accounting And The Accounting Cycle
Liability that company owes customers Deferred expenses – an asset resulting from the payment Depreciation Equipment that lasts longer than one year should be treated like any other prepaid expense We should allocate the cost of the asset to the periods that benefit from the use of ... Document Viewer

WaHayatiAndak - YouTube
She asked for this many kids. Why should my taxes support her? I make $4.00 above poverty level and I don't qualify for anything. This lecture covers adjusting journal entries for prepaid expenses (asset vs. expense methods) and deferred revenue (liability vs. revenue methods) ... View Video

Expense - Wikipedia, The Free Encyclopedia
This is in contrast to capital expenditures that are paid or incurred to acquire an asset. Expenses are costs that do not acquire, improve, or prolong the life of an asset. ... Read Article

Prepaid expenses should be recorded for items where a bill has been paid in the current fiscal year for a good or service that will not be received until the next fiscal year. ... Read More

Dbriefs U Presents
• Generally, tax depreciation rules allow the cost of the asset to be recovered through depreciation deductions on an accelerated basis as Prepaid expenses – Example of book/tax adjustment Book insurance expense $60,000 Tax insurance expense $120,000 ... Content Retrieval

Tax Effect Accounting - University Of Southern Queensland
(Once again prepaid expenses allowed for tax therefore tax balance sheet would not record any prepayments) 0 16 000 Results in a deferred tax asset - because an additional deduction ... Access Document

Prepaid / Accrued Expenses - AuditNet: Knowledge Is Power ...
Certain expenses that are paid by a single disbursement of funds provide benefits of a continuing nature to the bank. These items are recorded in prepaid expense accounts as assets and are transferred to expense by pro-rata monthly charges over the benefit period. ... Access Doc

Accrual Accounting - UNM - New Mexico's Flagship University ...
– Credit Prepaid Expense 1/12 (decreases Asset) Accrual Entry #2 • Each month, beginning in January: – Debit Insurance Expense 1/12 (increases expense which decreases Net Assets) Prepaid Expenses • Monthly Journal Entry, beginning with month paid: ... View This Document

CHAPTERS 3 AND 9—ADJUSTING ENTRIES AND ACCOUNTING FOR ...
Prepaid Expenses—expenses paid in cash and recorded as assets (or expenses as shown in the chapter appendix—alternative treatment of prepaid expenses) Accrued revenue is also called an Accrued Asset as the debit will be to a Receivable ... Retrieve Here

Matching Principle - Wikipedia, The Free Encyclopedia
Deferred expenses (or prepaid expenses or prepayment) is an asset, A Deferred expense (prepaid expenses or prepayment) is an asset used to costs paid out and not recognized as expenses according to the matching principle. ... Read Article

12.2 Prepaid Expenses
Chapter 12: Advances and Prepaid Expenses 12.2 Prepaid Expenses Effective date: April 1, 1999 Government of Nova Scotia The value of the future benefit portion should be recorded as an asset in the prepaid expense asset accounts. ... Fetch This Document

Adjustments For Financial Accounting
Prepaid Expenses An asset awaiting assignment to an expense. Prepaid Expenses An asset awaiting assignment to an expense. Prepaid Expenses Example On September 1, 1998, Bob’s Bait Shop prepaid its rent for the next twelve months. Rent is $200 per month. ... View This Document

Rules Of Debits And Credits - Austin Community College ...
Accounts receivable, merchandise inventory, supplies, prepaid expenses, land, buildings, equipment, and vehicles. Assets are increased with a debit and decreased with a credit. balance) in the asset Accounts Receivable may indicate that a customer has overpaid or prepaid. Next, ... Return Document

CHAPTER 4 Accrual Accounting Concepts Study Objectives
Prepayments fall into two categories--prepaid expenses and unearned revenues. 1. Prepaid expenses - expenses paid in cash and recorded as assets until they are used or consumed. Prepaid decrease or a credit to an asset account. . ... Get Document

Section 2170 Prepaid Expenses Accounting And Reporting
(CICA) of recording prepaid expenses as a non-financial asset on the statement of financial position and expensing their use or consumption in the statement of operations. .02 Each ministry is responsible to maintain accounting records ... Access Content

Balance Sheet And Statement Of Cash Flow Gapenski Chapter 4
An adjusting entry is made to convert a proportionate part of prepaid expense asset to a P/(L) Expenses vs. expenditures -- Why are prepaid expenses not expensed immediately when paid? 10/31 exemplifies an adjusting entry. Valuation of assets Valued at historical cost Tangible (physical ... Access Document

Year End Close FY2005
Prepaid expenses are a balance sheet asset and represent payments for gods or services that have not been received by June 30th. For financial statement purposes expenses are recorded only after an activity actually happens. ... Retrieve Here

Rent itself, is a current asset called Prepaid Rent Expense. Effect on the accounting equation Whereas prepaid expenses are paid before they are incurred/consumed, some expenses will be incurred before they are paid. For example, wages may be owing to employees ... Fetch This Document