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income and expense statements of an institute
02-07-2010, 09:21 PM,
#1
income and expense statements of an institute
assalamualykum,

i m running an institute, have made monthly expense and income report and throgh that i have prepared my statements (trial balance, income statement and balance sheet) from july to jan 09-10. i have maintained an account for this branch called credit from headoffice which is a liability account as a new branch we started was been supported by headoffice, now when new branch is been earning profit and i want to return the credit all i m doing is debit credit from headoffice and credit cash am i ok with this? second i know there are some adjustments i should make in regard of stationary, office supplies, and depreciation but i want to know is there any way i should find how should i depreciate assets, i got furniture, computers, acs, ups, generators, i m asking is there a schedule describing depreciation about different assets? or should i just do it by my own practice? third thing i got an account of rep & maintainance, which involve reparing like wiring, telephone set repairs, office bell repairs, like these, and want to ask does this account also will be adjusted at year end? as office bell telephone set will be further used. fourth one is i got an account of advertisment , which include sign boards, skins now should i make adjustment of these too? as i will using them in next accounting period should i capitalize these or ? here is the report i have uploaded so you can see i m doing ok or not, first report is named final which presents monthly data second is u.c statements which holds statements..see if you can guide me better. jazakALLAH

http//www.4shared.com/file/216838238/1d5c62ff/uc_96statements.html

http//www.4shared.com/file/216839407/1aff377a/fin97al.html
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02-07-2010, 10:39 PM,
#2
 
hÌ, SALAAM,
=> Regarding your liability question, your entries are wrong. If you credit cash again when you collect debt then it means you have spent more cash, which is a wrong entry. Did you pay your new branch in cash to help them? And is the new branch paying your head office in cash for reducing their liability?
=> You need judgement and estimate for depreciation. Estimate the economic life of assets and then you can use straighline method of depreciation of reducing balance method. Remember all assets within the same class will be depreciated(you can't depreciate just one computer and leave the rest computers undepreciated)
=> You have to account for all the transactions that occured in this accounting year. Use of telephone and bills relating to next accounting year will be dealt with in that accounting year. Assuming your repair expenditure for the current year is of revenue nature, it must be charged to the income statement for the current year(capital expenditure will be capitalised)
=> Advertisement expense is NOT capitalised but ALL the expense of current year is written off to the current year's income statement. When you will incur advertisement expense next year then it will written off to the income statement of that year
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02-07-2010, 10:45 PM,
#3
 
And i am sorry, i can't see the links provided. I have sold my pc and am using mobile right now
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02-08-2010, 01:18 AM,
#4
 
you did't get me, or i think i did not make it clear, i actually am maintaining of new branch's accounts as well and was asking for that, when i return credit for headoffice is when i make the entry.
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by Dard</i>
<br />hÌ, SALAAM,
=> Regarding your liability question, your entries are wrong. If you credit cash again when you collect debt then it means you have spent more cash, which is a wrong entry. Did you pay your new branch in cash to help them? And is the new branch paying your head office in cash for reducing their liability?
=> You need judgement and estimate for depreciation. Estimate the economic life of assets and then you can use straighline method of depreciation of reducing balance method. Remember all assets within the same class will be depreciated(you can't depreciate just one computer and leave the rest computers undepreciated)
=> You have to account for all the transactions that occured in this accounting year. Use of telephone and bills relating to next accounting year will be dealt with in that accounting year. Assuming your repair expenditure for the current year is of revenue nature, it must be charged to the income statement for the current year(capital expenditure will be capitalised)
=> Advertisement expense is NOT capitalised but ALL the expense of current year is written off to the current year's income statement. When you will incur advertisement expense next year then it will written off to the income statement of that year

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
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02-08-2010, 01:50 AM,
#5
 
Okay, then your entries are okay
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