We signed up for 1 year contact at 35k. Monthly expense is 2800/mo. if the vendor is invoicing us quarterly 12k on first two quarters and 3rd and 4th, they will invoice 4600. Dr Accrued expense: 35000 Cr A/P : 35,000 What accounts do i use or how do i make monthly expense? I appreciate any feedback. Thank you.
Sage software - how to expense
Answers
If I understand you right, you get invoiced the first month of every quarter.
For example... January 1, 2019 - Invoice for $8,400 (3 x $2,800) received from vendor
On January 1, 2019 ---
DR Prepaid Expense $5,600
DR Software Expense $2,800
CR Cash $8,400
Each month after...
DR Software Expense $2,800
CR Cash $2,800
Until April 1, 2019 ---
DR Prepaid Expense $5,600
DR Software Expense $2,800
CR Cash $8,400
Filed Under:
Accounting